These Are The Nigerians Benefiting From The Fall Of The Naira

The Naira has plunged more than 70% in the black
market when compared to the parallel market since
the Central Bank adopted its "managed float"
exchange rate system that saw it introduce quasi
capital controls as well as restricting the purchase
and sale of forex at its official window. The widening
premium between the parallel market rates and the
official/interbank rates have increased the activities
of speculators and round tripping further worsening
the currency situation.
It's however not just speculators who have benefited
the most from the misfortunes of the naira. Several
other market participants are also benefiting every
single day the naira plummets against the dollar at
the parallel market. We take a look at some of them;
Diaspora Nigerians
This is perhaps the best time to live and work
outside Nigeria especially if your income is in
dollars. Dami, a Nigerian who lives abroad reveals
that she and her husband thought rather than wait
till summer, they decide to visit Nigeria now that the
exchange rate favours them. Sensing blood, many of
them exchange their dollars in little tranches
believing that today's rate will always be cheaper
than tomorrows. Some believe this is the best
opportunity to buy land and houses as the value of
the dollar has now risen by about 70% against the
Naira while property prices have been somewhat
depressed.
Commercial banks
Banks have been under pressure since the price of
oil began its devastating fall in July 2014. With huge
exposures to the oil and gas sector they have seen
their loans increasingly become risky with
borrowers missing out on their obligations.
However, they have also posted massive gains from
forex as can be seen in their income statements at
the end of financial year 2014 and the first 9 months
of 2015. Most people who purchase items online
have also confirmed that banks charge them as
much as N290 to the dollar even thought the CBN
pegs the rate at around N199.
BDC Operators
These are perhaps the biggest benefactors of
Nigeria's forex woes. The CBN in January banned
sale of forex to BDC operators accusing them of
buying forex from the CBN at N199 and then selling
at the black market. The CBN also noted that the
BDC's buy dollars from the CBN at N197 only to sell
to their customers at N250. According to the CBN it's
no wonder that BDC have risen "from a mere 74 in
2005 to 2,786 BDCs today. In addition, the CBN
receives close to 150 new applications for BDC
licenses every month."
Exporters
Businesses engaged in exports are also huge
benefactors of the declining exchange rate.
Revenues from their exports officially should route
through the CBN as export proceeds however it is
understood that some of them move a chunk of that
to the black market. With gains as high as 50% most
of them find it hard to resist the lure of selling their
hoard at the black markets rather than at the official
window.
Friends and associates of the CBN
Reports also suggest that people close to the
management of the CBN or indeed the government
are also befitting from the fall of the Naira. They get
preferential treatment from the CBN by buying at
official rates rather than at the black market rates
where a lot of Nigerians go to. The CBN has also
expressed its desire to sell forex to businesses it
perceived are creating jobs at home rather than to
cater for "irresponsible demand" which the CBN
opines are what other importers of "non essential"
goods and services engage in.
Source:http://nairametrics.com/nigerians-benefiting-from-
the-fall-of-the-naira/