The Nigerian Senate on Monday expressed surprise at a recommendation by the Nigerian Law Reform Commission for a review of the Nigerian Foreign Exchange Act to accommodate punishment for persons holding on to foreign currency.
The commission wants the law to empower the the Central Bank of Nigeria to jail people for up to two years or fine them for 20 per cent of the amount of the foreign currency held in their possession for more than 30 days.
The Senate in a statement signed by its spokesperson, Senator Aliyu Sabi Abdullahi stated that with its focus on boosting investor’ confidence in the nation’s economy, such move as proposed by the Commission that will prevent investors from making free entry and free exit from the market will be outrightly rejected by its members.
He said; “The measure is disruptive and counter productive, threatening to undermine many of the reform efforts already underway in the legislature and by government ministries intended to boost investor confidence.
“The Senate would never pass such a punitive and regressive proposal. Overall, some of the Commission’s recommendation has many sound attributes and could help Nigeria’s investment climate. We believe the CBN should have the authority to regulate the forex market and determine the exchange rate policy as already enshrined in its enabling Act.
” A market-oriented exchange rate policy is the best recipe for guiding the operations of the foreign exchange market. This will ensure the supremacy of market mechanisms in efficiently allocating the scarce forex resources”.
“The Upper Chamber believes the CBN should have the authority to regulate the forex market and determine the exchange rate policy as already enshrined in its enabling Act,”.
“We will continue to work with the Executive to halt the worsening recession and return to economic growth.”