Security Agents Raid Black Market FX Dealers to Stop Naira Slide

In a bid to end the slide in the value of the Naira against foreign currencies, securi­ty agents raided the offices of black market currency dealers on Thursday, detaining some and ordering others to sell dollars at a lower rate in a bid to break the fall of the currency, dealers said.
With Naira trading at N305 to the dollar in the official mar­ket, the parallel or black markets have the currency at N465 to the dollar.

The Central Bank of Nigeria (CBN) has been unable to stop the Naira’s slide on the black mar­ket, where importers go to buy dollars due to severe hard cur­rency shortages in the country.
The economy has been pushed into recession partly by a slump in prices for oil, a key source of revenue that has the added at­traction of coming in the form of dollars.
The central bank has kept the official Naira rate to the dollar artificially high, effectively driv­ing hard currency dealing away from commercial lenders and towards the black market, the real benchmark.
“The police and state securi­ty service officials are raiding black marketers in Lagos and Abuja to compel an apprecia­tion of the Naira,” Mallam Ad­amu, a bureau de change opera­tor, told Reuters.
Another trader said security agents visiting bureau de change operators told dealers not to sell dollars for more than N395.
“We’ve stopped buying dol­lars from just anybody that walks into our shop due to the harassment from security agents and a directive from our associ­ation,” said a dealer, asking not to be named.
Alhaji Aminu Gwadabe, Chairman of the Bureau de Change Association, said his li­censed dealers had agreed with the central bank and security agencies to enforce a rate of 390 to 400 to the dollar.
“The issue of Naira deprecia­tion has been narrowed to the activities of speculators and we have decided, with the coopera­tion of both the central bank and the security agents, to enforce a new rule on pricing,” he said.
The Lagos police declined to comment. A source at the cen­tral bank only said the bank was concerned about the spread be­tween the official and parallel market rate. (Reuters)
In June the central bank said it would float the naira but in effect it has reinstated a peg at 305.5 naira per dollar via its daily in­terventions on the official mar­ket. It closed at that level on Thursday. (Reuters)