Forex restriction: CBN issues warning to companies

Governor of the Central Bank of Nigeria (CBN), Mr. Godwin Emefiele, has warned companies conniving with unscrupulous individuals to contravene the apex bank’s 41 items forex restriction to immediately desist.

According to the CBN boss, refusal to heed this warning would necessitate repercussions, including threats to such defaulting company’s continued chances of doing business in Nigeria.

Emefiele issued this warning while speaking during the recently held 53rd annual bankers’ dinner as organised by the Chartered Institute of Bankers of Nigeria, CIBN, went further to state that one of the punishments for defaulters will come in the form of restrictions placed on their accounts with the CBN.

He also revealed that the CBN is working in partnership with the Economic and Financial Crimes Commission (EFCC) to commensurately punish defaulters.

“The CBN’s economic intelligence and banking supervision department will work very close with the EFCC to expose and sanction any bank or company whose directors or FX operator colluded with unscrupulous individuals or companies to

undermine the policy on 41 items.

“Such sanction will include but not limited to prohibiting the banks from maintaining bank account for such institution or person in Nigeria.” -Emefiele

The 41 items banned by the CBN range from consumer goods like rice to industrial goods like cement. As we analysed back in 2015 when the restrictions were imposed, the decision was part of CBN’s desperate measures to control Nigerians’ demand for hard currency dollar at a time when recession was hitting hard and the economy was struggling.

Emefiele believes this measure has yielded results by encouraging local production and stimulating economic growth; hence the need to sustain it.

He further reiterated the CBN’s commitment towards ensuring that local production of goods and services are intensified in the country.

“Based on our internal research conducted by the Central Bank of Nigeria, there is strong evidence that the recovery from recession may have been much weaker, even negative without the implementation of the restriction on the 41 items.”