Central Bank to stop forex sales to banks by end of 2022: Introduces non-oil FX rebate scheme
CBN Governor, Godwin Emefiele, said the banks must begin to source their forex from export proceeds.
“The era is coming to an end when, because your customers need 100million dollars in foreign exchange or 200 million dollars, you now want to pack all the dollars and pass it to CBN to give you dollars.
“It is coming to an end before or by the end of this year. We will tell them don’t come to the Central Bank for foreign exchange again go and generate your export proceeds.
“When those export proceeds come, we will fund them at 5% for you and they will earn rebait. Then you can sell those proceeds to your customers that want 100 million dollars. But to say you will continue to come to the Central Bank to give you dollars, we will stop it,” the CBN boss said.
He made the comments at a briefing during the launch of the bank’s new forex repatriation scheme, RT200, held after the Banker’s Committee meeting on Thursday, in Abuja.
The CBN Governor, Godwin Emefiele, in his speech, said “After careful consideration of the available options and wide consultation with the banking community, the CBN is, effective immediately, announcing the Bankers’ Committee “RT200 FX Programme”, which stands for the “Race to US$200 billion in FX Repatriation.”
RT200 which stands for Race to $200bn is a set of policies, plans and programmes by the CBN for non-oil exports that will enable Nigeria generate $200bn in forex repatriation from non-oil exports, over the next three to five years.
Under the programme, which is to take effect immediately, the apex bank will provide concessionary and long-term loans for businesses interested in expanding existing plants or building new ones for the sole purpose of adding significant value to the non-oil commodities before exporting same.
According to Emefiele, the decision is in line with the CBN’s new commitment to boost the country’s foreign reserves through proceeds from non-oil exports.
The CBN governor said the commercial banks do not have a choice but to begin to explore ways of generating their forex.
“I said to them at the meeting that the era is coming to an end when your customer has a demand for $200 million and you move all the requests to the CBN.
“Before, or about latest, the end of this year, we will tell them don’t come to the central bank for foreign exchange again. Go and generate your export proceeds, fund people who want to generate export proceeds and when they come in, you can sell to your customers that want $200 million.
“Maybe when we see the record of export proceeds you have generated, we will give you 10 per cent of it.
“Nigeria cannot continue to depend on FX earnings to fund its import obligations from revenue coming from earnings from products where we cannot determine both price and quantity,” he also said
Similar to the naira for dollar programme, this programme, he said, would also entail a forex rebate scheme where the exporters will be paid N5 for every dollar they put into the economy.
“Today, we are also announcing the introduction of the non-oil FX rebate scheme, a special local currency rebate scheme for non-oil exporters of semi-finished and finished produce who show verifiable evidence of exports proceeds repatriation sold directly into the I&E window to boost liquidity in the market,” Emefiele revealed.
In recognition of the perennial problems of port congestion cited by exporters as a major impediment to improved operations and foreign exchange earnings, Emefiele noted that the CBN plans to establish a dedicated non-oil export terminal.
He also said that the Bankers’ Committee would be partnering with state governments that have existing ports to achieve this goal, adding that the committee would provide a significant part of the funding needed for the project.
