CBN excludes substandard goods importers from Currency swap

The Standard Organisation of Nigeria (SON)  may soon renew the onslaughts on substandard goods, as the Central Bank of Nigeria (CBN) on Wednesday declared that nation’s currency swap agreement with the People’s Bank of China (PBoC), will not cover the importation of substandard goods into the country.

The CBN Governor, Mr Godwin Emefiele indicated this in Abuja, at the Currency Swap Forum for North Central Zone, noting that deal was meant to boost the trade between Nigeria and China and ensure stability in the foreign exchange market, among others.

The forum which brought together stakeholders in the trade sector – importers and exporters – to sensitise them on the conditions and benefits of trading under the new Reminbi denominated window, subsequently

re -evaluate the possible gains of the swap, with the official exchange rate for Naira-USD at N306.05 to a dollar while one Chinese Yuan exchanges for N44.45 in the official market.

It will be recalled that the CBN and PBoC signed a three-year renewable bilateral currency swap deal worth about N720 billion or 15 billion Renminbi.

Emefiele, represented by the bank’s acting Director, Corporate Communications, Mr Isaac Okorafor, said the swap deal had the potential to reduce importation of substandard goods.

He also said only goods approved by regulatory bodies such as Standards Organisation of Nigeria would qualify under the agreement.

“If there is anybody that thinks he or she will collect Renminbi through this window and sell on the street, the person is sadly mistaken.

“Transactions under the deal will be done electronically and this deal is only for products that originate from China.

“It does not apply to any transaction in Asia, outside the Chinese territory,” he said.

Also, Mr Oreva Eweh, the Assistant Director, Financial Market Department, CBN, cited speed and efficiency as some of the benefits of trading under the Renminbi denominated window for transactions with China.

Mr Richard Maikai of the Trade and Export Department, CBN, spoke on the documentation requirements under the agreement.

“Importers intending to import from China must obtain pro forma invoice denominated in Renminbi as part of the documents required for registration of Form M.

“Also, the foreign exchange window cannot be used for payments on transactions in which the beneficiaries are not in China.

“In addition, authorised dealers shall not open domiciliary accounts denominated in Renminbi for customers,” he said.

Maikai said Bureau de Change Operators were not eligible to take part in the transaction as cash transactions would not be allowed under the window.

Earlier, Mr Adetokunbo Kayode, the Director-General, Abuja Chamber of Commerce and Industry, Mines and Agriculture (ABUCCIMA), said the currency swap deal would make doing business easier for his members.

He called on the government to implement favourable business policies to fast track economic growth in the country.


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