A bill to prohibit the use of foreign currencies for payments and transactions within Nigeria was approved by the Senate on Tuesday in its first reading.
The proposed law aims to end discriminatory practices and boost trust in the local currency by requiring that all payments, including salaries and transactions, be made in naira.
This requires export payments to be made in naira.
“A Bill to amend the Central Bank of Nigeria Act, 2007, No. 7, to prohibit the use of foreign currencies for compensation and for other related matters” was the title of the bill.
The Senate Committee on Reparations and Repatriation is chaired by Senator Ned Nwoko, who sponsored it.
Senator Nwoko claims that Nigeria’s financial system’s extensive usage of foreign currencies devalues the naira and prolongs the country’s economic problems.
Nigeria’s economic independence is still hampered by the colonial practice of using foreign currencies for domestic transactions, such as the dollar, pound sterling, and others, he said.
The bill aims to “prohibit salaries, transactions, and payments in foreign currencies, ensuring all workers, including expatriates, are paid in naira,” he said.
Additionally, he suggested that “crude oil and other exports be sold exclusively in naira, compelling international buyers to purchase the currency and driving its demand and value.” (2)
The measure, he contends, will “establish the Naira as the primary currency for all financial operations, thereby strengthening its economic dominance.”
The bill, Nwoko continued, will eliminate black markets for currency, which threaten the official economy and promote unethical behavior like banks round-tripping.
