Our economy is being run to the ground by the coconut heads at the helm of affairs.
Let me illustrate what Emir of Kano, Muhammadu Sanusi II is saying:
This is a real life story.
A British investor wanted to bring 50 million pounds into Nigeria and approached the Standard Chartered Bank asking what rate they will offer.
The investors said they will sell their 50 million pounds at 520 naira to a pound.
Standard bank approached the CBN and requested to be allowed to buy the pounds at that rate of 520.
CBN said NO, they could only allow a marginal increase above the official rate of 385 to 400 naira to a pound.
The investors approached Zenit Bank who happily grabbed the 50 million pounds at the rate of 520.
Within a short time the British investors approached Standard Chartered Bank again with another 50 million pounds.
Standard Chartered Bank has learnt their lesson and grabbed the money at the rate of 520. The bank dully filed their returns to the CBN. Do you know what the CBN did?
Last month The Central Bank of Nigeria fined Standard Chartered Bank N2billion for foreign exchange infraction.
CBN accused Standard Chartered Bank of buying $25 million at the official rate and selling same way above the inter-bank market rate.
Apart from the hefty fine, the commercial bank’s treasurer is also said to have been suspended by the apex bank ostensibly in the battle to rein in unwholesome banking industry practices that have engendered a huge differential between the inter-bank and parallel market rates.
This is Emefiele that let Zenith Bank go free now fines Standard Chartered Bank for doing the same thing.
That was why Mr. Sanusi argued that even if the National Assembly eventually grants the request, no global financial institution would give such loan.
The Emir of Kano, Lamido Sanusi, last Friday condemned plans by President Muhammadu Buhari to borrow $29,960 billion for the country.
Mr. Sanusi, a former governor of the Central Bank of Nigeria, said it would be difficult for the loan to be granted because Nigeria has five exchange rates.
He spoke at a policy dialogue forum organised by Savannah Centre for Diplomacy, Democracy and Development in Abuja.
“I can tell you for free, if the Senate today approves that we can borrow $30 billion, honestly, no one will lend us,” he said.
“It should be approved and I will like to see how you will go to the international market with an economy that has five exchange rates.
“There is one rate for petroleum marketers, there is interbank rate, there is another for money market operators such as western union, money gram, there is bureau de change rate and there is a special rate you get when you call the CBN for a transaction.
“So who will borrow you when they don’t know your exact reserve and exchange rate?
“I want to see who will borrow you money when the Niger Delta bombing of oil is there when the main source of the loan repayment is oil.”
Stating that Nigeria’s foreign exchange rates lacked credibility, Mr. Sanusi said the federal government should embrace private sector investments as a way out of its recession.