Forex Crisis: Peter Obi Challenges The FG's Clampdown On BDC Operators
Clampdown on BDC operators will worsen the situation says Peter Obi tells FG
The federal government's recent crackdown on Bureaux de Change (BDC) operators in the county has drawn criticism from Peter Obi, the former governor of Anambra State. Obi said that the approach was “ill-advised” and “wrongly directed.”
The former Labour Party presidential candidate claimed in a statement released on Sunday that attacks and disruptions of these business owners' operations will only have an impact on the economy.
“The recent reported attacks and disruption of the business activities of Bureaux de Change (BDCs) operators in different urban centres across the country by Government Agencies, are ill-advised and wrongly directed.
“Rather than solve the problem, the action will further escalate and worsen the exchange rate situation in the country. The BDCs are not the primary suppliers of forex nor do they create demand. They only provide a market to sellers and buyers of foreign currency.
“They are part and parcel of every economy and can be found even in the developed economies of the world. To think that the BDCs are the cause of the declining value of the Naira is a smack on rational economic thinking,” he said.
He blamed Bureau De Change operators for the current foreign exchange problems, criticizing the government for failing to address the fundamental problems in the foreign exchange market.
Obi contends that since BDC operators are a component of all economies, they cannot be held accountable for the Naira's depreciation.
The FX issue facing Nigeria is production
The LP politician went on to say that the lack of production in the nation is the root cause of the Naira's devaluation in the foreign exchange market.
He underlined the necessity for the government to combat systemic corruption and shift the economy from “consumption to production.”
Obi maintains that having “excess unproductive cash” does nothing but contribute to the depreciation of the Nigerian Naira.
“The only way to shore up the value of our currency is to move the country from consumption to production, especially export-led production, and fight corruption, which allows unproductive money to pursue the available supply of foreign currency.
“As long as Nigeria remains an unproductive economy and corruption continues unfettered with people in possession of unproductive excess cash, the value of our currency will continue to depreciate,” he said.
How It All Started
Operatives of the Economic and Financial Crimes Commission conducted raids on several Bureau de Change operators across the country earlier this week due to speculative activities and illegal foreign currency racketeering, with a focus on the Dollar.
It was reported that they had taken in roughly fifty illegal operators.
A Special Task Force had also been established by the EFCC across all of its commands in an effort to crack down on those who were dollarizing the Nigerian economy and mutilating the Naira.
The government's justification for this crackdown is to combat illicit activities involving currency, such as fraud and foreign exchange speculation.
However, the crackdown has also drawn criticism and controversy, with some expressing worries that it might hurt respectable businesses in the economy.
No comments:
Leave comment here