Lagos - Lamido Sanusi, the governor of the Central Bank of Nigeria (CBN), blamed the devaluation of the country's currency on politicians jockeying for positions ahead of the 2015 general polls.
Sanusi raised concern at the “ravenous demand” particularly for the United States Dollar by the politicians much to the detriment of the naira’s standing against the foreign currency.
Sanusi blamed the dollarisation of the economy by “political elite” for the continued weakness of the naira.
This, he lamented, was despite the CBN’s moves to prop it up with dollar sales that have depleted the bank’s reserves to an eight-month low.
While he could not specify why there was a high demand for the foreign currency by politicians, he said CBN's recent investigations, showed that billions of naira were traded for dollars in cash, much more than importers needed to buy goods or investors to repatriate funds.
He said there was no trace of where the money came from or where it was spent on.
“Obviously, this was some form of money laundering to cover all the trails. And with interest rates as high as they are, the only people who can take that much naira and buy dollars are people who are not borrowing their money,” Sanusi said.
According to him, the CBN had noticed a surge in demand for dollars at the forex bureaus in July, which showed that something was “amiss” after several months of spending huge resources to defend the naira and ensure its stability.
Last weekend, the apex bank revoked the operating licences of 20 bureaus-de-changes as part of measures to curb foreign exchange abuses in the sub-sector.
It later issued new guidelines to ensure closer monitoring of transactions in the market.
– CAJ News