Business
Abuja BDC Operators Halt Operations Due to Dollar Scarcity
Abuja BDC Operators Halt Operations Due to Dollar Scarcity
In a recent turn of events, Bureau de Change (BDC) operators in Abuja have made the decision to suspend their operations due to the scarcity of dollars, as reported by the Daily Trust. This significant move was announced by the association’s chairman, Abdulahi Dauran, on Wednesday and is set to take effect on Thursday, February 1, 2024.
The naira’s value has reached an all-time low of N1,482 against the United States dollar on the official window while remaining stable at N1,450 on the parallel market. Dauran attributed this closure to online business transactions and the impact of cryptocurrency on the market.
This development comes at a time when the Central Bank of Nigeria (CBN) has initiated fresh measures to stabilize the nation’s volatile exchange rate. The CBN’s recent order to deposit money banks (DMBs) to sell their excess dollar stock by February 1, 2024, is part of these efforts. Additionally, the apex bank has cautioned lenders against hoarding excess foreign currencies for profit.
Some commercial banks may have held long-term foreign exchange positions in order to profit from the erratic fluctuations in exchange rates, according to suggestions made by CBN officials. In response, the new directive has introduced a set of guidelines aimed at mitigating the risks associated with these practices.
The decision by BDC operators to halt operations is a clear indication of the severity of the dollar scarcity issue and its impact on the local economy. This move not only affects the operators themselves but also has broader implications for individuals and businesses reliant on their services for foreign exchange transactions.
The CBN’s proactive measures are aimed at addressing the root causes of the current challenges in the foreign exchange market and ensuring stability. It is evident that the central bank is taking steps to discourage speculative activities and promote a more transparent and sustainable foreign exchange system.
As the situation continues to unfold, it is crucial for all stakeholders, including the CBN, BDC operators, commercial banks, and the business community, to work together towards finding long-term solutions that will mitigate the impact of dollar scarcity and contribute to a more stable and resilient foreign exchange market.
It remains to be seen how these developments will shape the future landscape of foreign exchange operations in Abuja and across Nigeria. The coming days will undoubtedly shed more light on the effectiveness of the CBN’s directives and the resilience of the local foreign exchange market in the face of ongoing challenges.
