ABCON still worried about multiple exchange rates

Launches online platform for live forex rate
The Association of Bureau De Change Operators of Nigeria (ABCON) said it is still worried by the continued multiple exchange system in the nation’s foreign exchange market.

The group said there are no less than six exchange rates- Muslim pilgrims rate; a retail rate set by licensed BDCs; and a rate for foreign travel and school fees; the official rate; and black market rates.

Besides, ABCON is recommending a process of integration of the BDCs into the popular Investors and Exporters (I&E) Windows, since the platform services the same small and medium scale liquidity needs of the market, as a process of deepening the market and unifying the exchange rate.

The President of ABCON, Aminu Gwadabe, who quoted IMF working paper no WP/08/199, said the observed multiple exchange rate system creates various economic distortions.

“They developed a model of foreign exchange markets, and present the efficiency costs imposed by quasi-fiscal operation under the current exchange rate regime.

“The results of the model-based analyses indicate that the equilibrium exchange rate under the unified market could increases trade openness to more than 20 percent from less than one per cent measured by official statistics,” he said.

The group in its quarterly economic review, also expressed concern on a possible ripple effects of the forthcoming 2019 elections and the preceding campaign process.

“The development, which would be another round of economic shock, would see foreign investors who invested billions of dollars in the equities market taking their exit,” he said.

He added that the negative implication of the exit of portfolio investors from the local bourse therefore, is a major concern on the local currency’s continued stability.

Meanwhile, ABCON will launch its online platform www.naijabdcs.com, a live rate engine room created by the ABCON to promote transparency and price discovery in the foreign exchange (forex) market.

Speaking to financial journalists ahead of the portal launch at the Lantana Hall, Eko Hotel & Suites, Victoria Island, Lagos, Gwadabe, said the group had secured the no- objection approval on the engine room from the Central Bank of Nigeria (CBN).

Gwadabe said the world is going digital, and Bureaux De Change (BDC) operators under his leadership are committed to staying ahead of the competition by deploying time-tested technology to deliver effective services to their numerous customers.

He said the objective is to make www.naijabdcs.com a household name in financial reporting, coverage and first choice for investors and tourists in accessing quality and reliable information on forex market and rates.