Nigeria’s central bank has taken a significant step to boost liquidity in the foreign exchange market by scrapping a rule that required oil companies to retain part of their export earnings locally. According to #Bloomberg, the move allows oil companies to repatriate 100% of their export proceeds, a reversal aimed at restoring trust in the country’s foreign exchange market.
The previous rule required oil companies to hold back 50% of their export earnings for 90 days, a measure introduced during a period of dollar shortages. The central bank has now done away with this requirement, allowing companies to transfer the full amount through authorized banks, subject to proper documentation and monthly reporting.
The move is expected to increase liquidity in the foreign exchange market, providing much-needed dollars for the economy. Experts say the policy shift is a welcome development, as it will help to stabilize the naira and attract foreign investment.
A top industry official welcomed the move, saying it would enhance the ease of doing business in Nigeria’s oil sector. The official noted that the previous rule had created uncertainty and hindered the sector’s growth.
Nigeria is Africa’s largest oil producer, and the move is seen as a key step in the country’s efforts to boost economic growth and attract foreign investment. The central bank’s decision is expected to have a positive impact on the country’s economy.
Source: #Bloomberg
Author: Stella Sunu
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