Nigeria threatens to sanction banks providing forex for ‘not valid’ imports

Lagos (AFP) – Nigeria’s central bank on Thursday threatened to sanction banks and forex dealers who provide foreign exchange to import luxury items such as private jets and other products that can be sourced locally.

In a statement published in newspapers, the Central Bank of Nigeria (CBN) listed more than 40 items which are not valid for foreign exchange funding, including rice, private jets, cement, toothpicks, margarine, tinned fish, poultry products, soap and cosmetics.

Analysts said the move was to encourage local production of the items, discourage frivolous consumption, preserve scarce foreign exchange as well as stop the ongoing fall of the national currency.

“All the items… which have already been classified as ‘not valid for forex’ cannot be funded at the interbank (foreign exchange market), from proceeds of exports and bureaux de change (BDC) sources,” CBN said.

“Any authorised (forex) dealer that is found to have used funds from the interbank, exports proceeds and BDC to consummate these items… or undertaken money wire transfer for a BDC shall be sanctioned appropriately,” it added.

Although the central bank did not spell out the penalties, bankers told AFP they could include the withdrawal of operating licences and prosecution of offenders.

Despite banning the imports of rice, poultry and dairy products to protect local manufacturers, the goods still find their way into the country through smuggling.


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