Senate rejects proposal to jail those hoarding dollars

The Senate has vowed to reject the proposal to review the Nigerian Foreign Exchange Act in order to to allow the federal government jail people who hold dollars in cash for more than 30 days.

According to a draft published on the website of the Nigerian Law Reform Commission, the measure is to empower the Central Bank of Nigeria (CBN) control in and out flow of foreign currencies.

“The amendments are necessary for effective monitoring and control, and to ensure probity in foreign-exchange transactions in Nigeria,” the draft read.

But in a statement signed by Aliyu Abdullahi, spokesman of the upper legislative chamber, the senate said the proposal was capable of discouraging foreign investors.

Abdullahi said the senate was more interested in boosting investor’ confidence in the nation’s economy, and not the other way round.

“The measure is disruptive and counter productive, threatening to undermine many of the reform efforts already underway in the legislature and by government ministries intended to boost investor confidence,” the statement read.

“The senate would never pass such a punitive and regressive proposal. Overall, some of the commission’s recommendation has many sound attributes and could help Nigeria’s investment climate. We believe the CBN should have the authority to regulate the forex market and determine the exchange rate policy as already enshrined in its enabling Act.

“A market-oriented exchange rate policy is the best recipe for guiding the operations of the foreign exchange market. This will ensure the supremacy of market mechanisms in efficiently allocating the scarce forex resources.

“We will continue to work with the executive to halt the worsening recession and return to economic growth.”