Cross-border traders abandon businesses over naira’s fall

Naira has continued a downward slide in the West African sub-region trading at N2,010 per CFA1000 at the close of business last Friday. Naira traded at N1,870 per CFA1000 at the open market at the weekend. While, as of Thursday, it was sold at N1,800 at one of the nation’s busiest and most popular land […]

Naira has continued a downward slide in the West African sub-region trading at N2,010 per CFA1000 at the close of business last Friday.

Naira traded at N1,870 per CFA1000 at the open market at the weekend. While, as of Thursday, it was sold at N1,800 at one of the nation’s busiest and most popular land borders, the Seme-Krake border in the Badagry area of Lagos.

The continuous downward slide of the naira has forced most traders in the cross-border business to abandon their businesses.

This has also affected the market prices of commodities, with petrol now selling at an all-time high of over CFA 1000 (about N2,010) per litre, making smuggling of petrol now a lucrative business since the removal of subsidy in May.

• JNI wants Plateau muslims included as beneficiaries of Tinubu’s wife’s N500m gesture
• NIGERIA DAILY: Step By Step Guide On How To Hold Politicians Accountable

CFA franc scarcity forces markets to transact in naira in Niger

Markets in Niger Republic’s communities bordering Nigeria are now carrying out cash transactions in naira due to the scarcity of CFA francs in circulation in the country.

According to residents and traders interviewed by our correspondent, the naira is in full circulation in provinces that border the Nigerian states of Borno Yobe, Kano, Katsina and Sokoto.

A resident of Diffa, Aminu Abdulkadir, who spoke to Daily Trust on the phone, said since the military coup in the uranium-rich country, the CFA Franc has become very scarce in the country.

“Now, before you see a single CFA franc in the Diffa market, you will see the different naira denominations in circulation. It’s what everybody is using here, including the government officials.

“The only area where we don’t transact with naira is at filling stations and in remittance of government revenues,” he said.

He said many POS operators from Nigeria have established business in markets around Diffa, Gigime, Boso, Kablewa, Jakori, Garin Wanzam, Kinchambi, Tumar and some parts of  Maradi province that border Nigerian states of Katsina and Kano.

A journalist in Niger, who preferred a single name said the scarcity of the CFA franc has compelled them to switch to the naira, which is easily available.

“We usually trade in both currencies before, but the scarcity of the CFA franc in the border communities has forced us to trade more in naira,” he said.

He attributed the scarcity of the CFA franc to the mop-up by government officials who suspected that France was behind the cash crunch.

“We were told that apart from the Niger Franc, they are stocking cash in the form of Chad and Burkina Faso CFA francs.

“However, other sources are blaming your people (Nigerians), of coming into Niger to pack millions of CFA franc, and return to Nigeria, where they convert it to dollars and make profit,” he alleged.

He said, recently, the value of the CFA franc has been appreciating against the naira. “I can’t explain why but the value of the naira against the franc kept falling. A few weeks back, the exchange rate was 1100 CFA franc to N1,200 but it’s now between N1600 to N1700,” he added.

Cross border business no longer lucrative – Traders

Similarly, a bag of 50kg of rice sold for between N9,000 and N12,500 has risen sharply to about N35,000 across the Seme border since the naira started a free fall.

A carton of frozen poultry products which was formerly sold at N8,000 is now sold at N28,000.

Nigerians who travel across the border to buy goods are now lamenting that cross-border business is no longer lucrative.

A trader at the Vespa market in the Ojo area of Lagos, John Ebube, who spoke to our correspondent said the naira started a downward slide in the last two months.

According to him, the naira was traded at about N1200 to CFA 1000 in August, but that between August and October, it crashed to N2,010.