Kehinde Fajobi
The Senate has taken steps to restore Nigeria’s monetary sovereignty by proposing legislation that bans the use of foreign currencies for payments and transactions within the country.
The bill, titled “A Bill for an Act to Alter the Central Bank of Nigeria Act, 2007, No. 7, to Prohibit the Use of Foreign Currencies for Remuneration and for Other Related Matters,” is sponsored by Senator Ned Munir Nwoko, Chairman of the Senate Committee on Reparations and Repatriation.
Senator Nwoko argued that the widespread use of foreign currencies like the Dollar and Pound Sterling for domestic payments undermines the Naira’s value and economic independence.
He described this practice as “a colonial relic that continues to hinder Nigeria’s economic independence.”
The proposed legislation will:
Prohibit salaries, payments, and transactions in foreign currencies, including for expatriates.
Mandate that crude oil and other exports be paid for exclusively in Naira to boost demand for the local currency.
Position the Naira as the sole currency for all financial operations, eliminating informal currency markets.
Direct banks to offer affordable loans to drive industrial growth and support local manufacturing.
Advocate storing Nigeria’s foreign reserves domestically to reduce external vulnerabilities.
Senator Nwoko said, “Reclaiming monetary independence and prioritising the Naira will increase its value, reduce dependency on foreign currencies, and build a diversified economy.”
He added that converting existing domiciliary account balances to Naira would be voluntary. As the Naira gains strength, the need to hold foreign currencies would diminish naturally.
Nwoko also assured Nigerians that access to foreign exchange for travel and other legitimate needs would be improved through banking reforms, easing concerns about Basic Travel Allowance (BTA) and forex availability.
Citing Morocco as an example, Nwoko noted that the Moroccan Dirham has maintained stability for over 35 years due to its exclusive use for domestic transactions.
He said, “With Nigeria’s vast natural resources and dynamic population, we can surpass Morocco’s achievements if we shift our mindset regarding the Naira.”
The bill envisions a future where Nigerian banks expand internationally, offering tools like cashless wallets for seamless global transactions, while rendering domiciliary accounts unnecessary.