The Senate has taken steps to restore Nigeria’s monetary sovereignty by proposing legislation that seeks to outlaw 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 explained that the widespread use of foreign currencies like the Dollar, Pound Sterling, and others undermines the value of the Naira and hinders Nigeria’s economic independence.
“The use of foreign currencies for domestic transactions is a colonial relic that continues to perpetuate economic challenges. It weakens our local currency and undermines confidence in the Naira,” he said.
The proposed legislation seeks to ensure that all salaries, transactions, and payments—whether by local workers or expatriates—are conducted in Naira. Additionally, the bill requires that crude oil and other exports be sold exclusively in Naira. This move aims to drive up demand for the Naira, increasing its value while reducing reliance on foreign currencies.
Nwoko emphasized that informal currency markets, which promote unethical practices like round-tripping, would be abolished, thereby strengthening the formal economy. He further stated that banks would be directed to offer loans at affordable interest rates to foster industrialization and economic growth.
The bill also calls for the domestication of Nigeria’s foreign reserves, reducing exposure to external vulnerabilities and safeguarding the country’s economic sovereignty. “Our goal is to reduce dependence on foreign currencies and foster national pride and self-reliance,” Nwoko said.
Senator Nwoko clarified that the transition of domiciliary account balances to Naira would be a voluntary process, ensuring that account holders maintain access to foreign currencies for legitimate purposes like travel. “We will streamline access to foreign exchange through banking reforms, ensuring that concerns related to Basic Travel Allowance (BTA) and other forex needs are addressed,” he assured.
Drawing comparisons with Morocco’s stable Dirham, which has maintained value for over 35 years through exclusive domestic use, Nwoko noted that Nigeria’s vast natural resources and dynamic population position the country to achieve similar success if a paradigm shift occurs in how the Naira is perceived and utilized.
The bill envisions a future where Nigerian banks expand internationally, offering innovative financial tools like cashless wallets that simplify global transactions. These reforms aim to overcome existing challenges, such as the difficulty of Nigerian debit cards in facilitating international online payments, reducing the need for domiciliary accounts.
If passed, this legislation could mark the beginning of a transformative era, driving economic growth, cultural pride, and sustainable development anchored in the strength of Nigeria’s currency—the Naira.
