The Central Bank of Nigeria (CBN) is trying to compel non-oil exporters to process dollar proceeds through local lenders to improve dollar liquidity and shore up the naira, Reuters reported on Thursday.
The apex bank says exporters who fail to remit dollar proceeds through the banks will be forbidden from official markets, a circular from the bank shows.
Exporters have cited the value of the currency on the official market, where the local currency is trading at a discount of about 20% to the black market, as a reason for hoarding dollars or circumventing banks to leverage parallel market rates.
They also sometimes conduct trade via offshore accounts.
The CBN also ordered lenders to stop processing letters of credit for imports for third-party suppliers or brokers with immediate effect. It could stand in the way of imports into the country.
Africa’s biggest economy, which has sought for months to bolster its declining reserves, recorded a contraction of 6.1% in its gross domestic product in the second quarter and sees it shrinking further in the third and fourth quarters, the presidency said on Wednesday.
Nigeria has been rationing dollars lately in an effort to conserve reserves following moves to harmonise its multiple exchange rates this month as part of the preconditions for a $1.5 billion World Bank loan that is yet to be approved.
However, dollar shortages have worsened, with reserves now down by 11.5% from a year ago.
The regulator has proposed talks with chief executives of multinationals in Nigeria to deliberate on the revamp of exports, especially for agricultural produce, and diversifying the economy away from its dependence on oil.
But plans face impediments as feeble growth and skyrocketing inflation impeded businesses worried about consumer demand and the impact of the coronavirus on logistics and global supply chains.
Cocoa, Nigeria’s export after oil, has strived to compete with top producers Ivory Coast and Ghana on account of low yields, poor farm inputs and funding, which caps output.