The Lagos Chamber of Commerce and Industry (LCCI) has called on the Central Bank of Nigeria (CBN) to ensure transparency in the formulation of guidelines for its new flexible foreign exchange regime.
The Director-General of LCCI, Mr Muda Yusuf, who made the call through a press stamen made available to Daily Times on Wednesday, reads that any preferential treatment could cause distortion and abuse of the policy.
He noted that the abuse could arise from creating special window for critical transactions with preferential rates.
“It can pose a risk to the entire system. We will like to be assured that the window for the critical transactions will be managed transparently and in a manner that it will not create distortions in the economy,” he said.
It could be recalled that the CBN on May 24 said it would adopt a flexible foreign exchange regime to stimulate economic growth, adding that the new guidelines on the management of foreign exchange market would soon be released.
Yusuf pointed out that the decision to refrain from monetary policy tightening would increase liquidity, boost investors’ confidence and attract more foreign exchange into the economy.
He urged the apex bank to review its ban on 41 items on foreign exchange exclusion list as they formed critical inputs of production for manufacturing companies, asking CBN to allow export proceeds, capital and Diaspora remittances into the economy through the autonomous window at prevailing market rates.
The DG suggested that owners of such funds should have unhindered access to their funds.
He said, “We also welcome the decision of the CBN to refrain from further tightening of monetary policy at this time. The current context is that the economy has been declining. The Gross Domestic Product (GDP) has contracted for the first time in twelve years; unemployment is on the rise; manufacturing capacity utilization has been weakening; and investors’ confidence has been at its lowest ebb. The decision not to tighten monetary policy is therefore appropriate.”