The Federation of Agricultural Commodity Associations of Nigeria has kicked against some sections of the September 24, 2020 circular of the Central Bank of Nigeria that focused on “unfettered access” to foreign exchange in export proceeds domiciliary account.
FACAN is the umbrella body of agricultural commodity associations across the country, comprising 55 registered commodity associations along the value chain.
Agricultural commodity dealers contribute to Nigeria’s economic growth through the generation of foreign exchange to the economy from non-oil export exchange proceeds.
The President, FACAN, Victor Iyama, told journalists in Abuja on Friday that the CBN would hamper the contributions of agricultural commodity dealers and other affected players by implementing some of the provisions of the circular.
He said, “The implementation of the contents of the circular in question will severely hamper our various businesses, thereby disrupting and possibly limiting the contribution we are making to our developing economy.
“By attempting to curtail the ‘unfettered access’ of exporters to their lawfully repatriated proceeds, it would be inadvertently stifling the competitiveness of our members and thus limiting the potential for our continued growth.”
Iyama added, “It is not in doubt that the CBN is tasked with the significant responsibility of maintaining financial and currency stability in our country, a task we appreciate is of a very complex and demanding nature.
“But we respectfully submit that the fact remains that the limitation of the business activities of exporters goes against the Federal Government’s transformation agenda and the promotion of non-oil export as this will negatively impact the successes achieved in the agricultural sector.”
The FACAN president noted that the apex bank had closed both the retail and wholesale auction windows through which currency was exchanged in Nigeria and directed that all exchange transactions should be carried out through the interbank market.
He admitted that that these were understandable and logical attempt to control the disparity between the various mechanisms of foreign exchange.
Iyama, however, noted that the further attempt to regulate the access and ability of domiciliary account holders to deal with their hard-earned lawful proceeds amounts was unwanted incursion into the business dealings of exporters.
“This is outside the scope of the Central Bank of Nigeria’s powers,” he stated.
He said the imposition of restriction on export proceed domiciliary account was not new, adding that prior to March 2006, similar restrictions imposed by the CBN led to absolute chaos in the forex market.
This, according to Iyama, resulted in huge disparity between official and parallel market rates, rate abuse by bankers and the bankruptcy of many exporters.
