Thursday, 24 November 2016

DSS Forces BDC Operators To Go Underground [Details]

Bureau De Change (BDC) operators in Nigeria have gone underground. 

This is due to the clampdown on them by the Department of State Security (DSS). 

The black market is the preferred method of changing foreign currencies for most Nigerians A report by Bloomberg has detailed how the once omnipresent money-changers on the teeming streets of Lagos have gone underground due to the clampdown on them by the Department of State Security (DSS).

According to the report, the BDC operators have become the latest target of the Central Bank of Nigeria (CBN) desperate to bolster the naira and crush a black market for foreign currency that is boomed for years. 

But the activities of the operators since the crash in oil prices has strangled the inflow of dollars. 

Earlier this month, the CBN capped prices that non-bank dealers can charge their customers for dollars, effectively pegging the black-market rate, while the DSS threatened to jail anyone who doesn’t comply. 

One trader in Surulere, Lagos who asked not to be identified as he feared arrest, said he would continue trading at the old rate with trusted customers while refusing to sell dollars to others. Anyone he doesn’t know may be a government spy, he said. “It’s a struggle even to get someone to sell us $200 whereas before, they’d often sell us $1,000 or $5,000. 

Now, they’re only exchanging when they’re desperate,” another operator simply identified as Usman said. Unrelenting, CBN governor, Godwin Emefiele said this week that “the security agencies should sustain their checks on the activities of illegal foreign-exchange operators in order to bring sanity to that segment of the market.” 

Economic experts have been reacting to the clampdown. Omotola Abimbola, an analyst at Afrinvest said: “The black market will go further underground. The fact they went as low as getting security forces on the streets shows a new level of desperation.” 

On his part, Manji Cheto, senior vice president at Teneo Intelligence in London said: “What Nigeria’s doing absolutely won’t work,” said Manji Cheto, senior vice president at Teneo Intelligence in London. 

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