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LequteMan
Guest
Bureaux de change (BDC) operators in Nigeria have voiced their support for the federal government’s position not to further devalue the naira.
President Muhammadu Buhari had on Saturday reiterated his defiant stance not to devalue the Naira. The currency has appreciated since then.
Related: Naira Appreciates Against Dollar for Second day in a Row
President of the Association of Bureaux De Change Operators of Nigeria (ABCON), Alhaji Aminu Gwadabe, on Tuesday said the association supports the position of the federal government that there would be no further devaluation of the naira.
“ABCON hereby aligns itself with the stance of the President that there would be no further devaluation of the naira.
He also dissociated BDCs from the rapid depreciation of the naira from N265 to N400 in the parallel market saying such developments is not good for the business of BDC.
“Depreciation of the naira affects the working capital of BDCs and by extension their turnover. BDCs are able to do more business when the exchange rate is stable and relatively close to the official exchange rate.
“Hence, BDCs cannot promote what is injurious to their business. Secondly, BDCs are basically intermediaries. They buy dollars from the public and sell to the public. Our incomes come from the margin between the selling rate and buying rate.
“To this end BDCs are more interested in turnover than in the exchange rate. We make money from the rate at which we can use our working capital to buy and sell dollars. We make money from the rate at which we can use our working capital to buy and sell dollars.
“Hence BDCs don’t determine the exchange rate; this is determined by the demand and supply for dollars in the market. With the intense scarcity of dollar in the market, and increased demand, the foreign exchange market has become a sellers’ market. The rate is largely determined by the sellers, and not by BDCs who are mere intermediaries," he added.
President Muhammadu Buhari had on Saturday reiterated his defiant stance not to devalue the Naira. The currency has appreciated since then.
Related: Naira Appreciates Against Dollar for Second day in a Row
President of the Association of Bureaux De Change Operators of Nigeria (ABCON), Alhaji Aminu Gwadabe, on Tuesday said the association supports the position of the federal government that there would be no further devaluation of the naira.
“ABCON hereby aligns itself with the stance of the President that there would be no further devaluation of the naira.
He also dissociated BDCs from the rapid depreciation of the naira from N265 to N400 in the parallel market saying such developments is not good for the business of BDC.
“Depreciation of the naira affects the working capital of BDCs and by extension their turnover. BDCs are able to do more business when the exchange rate is stable and relatively close to the official exchange rate.
“Hence, BDCs cannot promote what is injurious to their business. Secondly, BDCs are basically intermediaries. They buy dollars from the public and sell to the public. Our incomes come from the margin between the selling rate and buying rate.
“To this end BDCs are more interested in turnover than in the exchange rate. We make money from the rate at which we can use our working capital to buy and sell dollars. We make money from the rate at which we can use our working capital to buy and sell dollars.
“Hence BDCs don’t determine the exchange rate; this is determined by the demand and supply for dollars in the market. With the intense scarcity of dollar in the market, and increased demand, the foreign exchange market has become a sellers’ market. The rate is largely determined by the sellers, and not by BDCs who are mere intermediaries," he added.
