NIGERIA
Nigeria’ s Money- Changers Are Going Underground
Lagos, Nigeria. Photographer: Peeter Viisimaa via Getty Images
NIGERIA’ S INTERBANK MARKET SETS THE NAIRA’ S OFFICIAL VALUE AND IS MEANT TO SERVE BUSINESSES
On the teeming streets of Lagos, the Nigerian mega-city of 15 million people, the once omnipresent money-changers are going underground.
On the teeming streets of Lagos, the Nigerian mega-city of 15 million people, the once omnipresent money-changers are going underground. They’ ve become the latest target of authorities desperate to bolster the naira and crush a black market for foreign currency that’ s boomed since the crash in oil prices strangled the inflow of dollars and battered the economy. This month, the central bank capped prices that non-bank dealers can charge their customers for foreign exchange, effectively pegging the black-market rate, with intelligence agents threatening to jail anyone who doesn’ t comply.
That’ s creating a parallel market within the black market, according to analysts at Lagos-based Afrinvest West Africa Ltd. One trader in the Lagos suburb of Surulere, who asked not to be identified as he feared arrest, said he would continue using the old rate with trusted customers and refuse to sell dollars to others. Anyone he doesn’ t know may be a government spy, he said.
THE CENTRAL BANK HAS MADE SEVERAL ATTEMPTS TO DEFEND THE NAIRA AFTER IT PLUNGED IN LATE 2014 ALONG WITH CRUDE PRICES
26 Business Times Africa | 2016