Nigeria’s foreign exchange reserves would have crashed to as low as $2bn if the Central Bank of Nigeria had not restricted importers from accessing forex for the importation of about 42 items, the Federal Government declared on Tuesday.
According to the government, the release of the items on the foreign exchange restriction list by CBN has contributed in shoring up the country’s reserves to about $40bn.
In his address at an event organised by Guinness Nigeria Limited to honour farmers in Abuja, the Minister of Agriculture and Rural Development, Chief Audu Ogbeh, shared his recent conversation with the CBN Governor, Godwin Emefiele, and stated that the government was pleased that the apex bank was resolute in its decision on the forex restriction list, despite the barrage of attacks.
Ogbeh said, “I was with the (CBN) governor on Friday last week and I said to him you remember I met you at Frankfurt airport in early 2015. We were on our way to the United States and I saw him and said, ‘how are you’, and he said, ‘fine, but I’m being bashed around at home because I stopped 41 items on the forex restriction list.’
“He (Emefiele) came under a barrage of attacks and I said to him that I am on his side because the bank should have done this 20 years ago not now. So, I told him that when I get back from the trip, I will call a press conference to defend him. And I did. Because I saw the logic in what he was doing.
“On Friday, he (Emefiele) said to me that even those that criticised him, including non-Nigerians, now say to him that they love what he did on that issue. So, if he had been weak and had succumbed to the bashing, by today, we would have $2bn as foreign reserves, but right we now have about $40bn.”
Ogbeh also noted that it would be foolish to devalue the local currency as a result of its fall against the United States dollar, adding that it was better to cut down on imports.
The minister said the massive importation of various commodities almost crippled the domestic economy, as the country’s forex reserves were heavily depleted, especially when crude prices started to nosedive.
On Monday, News reports that the CBN might increase the items on the foreign exchange restriction list from 42 to 50 in order to boost local production and stimulate the export market.
Emefiele stated that the CBN would get more aggressive in ensuring that more items being imported into the country were added to the forex restriction list.
He said, “To put it in proper perspective, by the time you dimension the size of the foreign exchange we use in importing petroleum products into the country, it is at least one-third of the foreign exchange the CBN spends to import items into Nigeria today.
“By the time we add also the 42 items that we have, which certainly we are going to increase from 42 may be to 50 or more in due course because we are going to get more aggressive in ensuring that more and more food items that are being imported into this country, are added to the FX restriction list.”
Meanwhile, Ogbeh told guests at the event that the purchase of sorghum by Guinness from farmers in Nigeria had created wealth in rural areas and had contributed in reducing the unproductive migration of youths from villages to cities.
“I commend Guinness for buying sorghum locally from our rural farmers and this is because every time you import, you are importing poverty and exporting wealth and you are also importing danger. But by making purchases from our rural farmers, the wealth is being moved to these villages,” he said.