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Economy Reform : All exchange rate segmentation is “abolished with immediate effect,” Says CBN Director
…Market-driven currency regime excites financial experts
The Central Bank of Nigeria (CBN) yesterday unified all exchange rates within the economy into the Investors and Exporters (I&E) window.
In a circular to authorised dealers signed by CBN Director, Financial Markets, Angela Sere-Ejembi, the regulator said all exchange rate segmentation is “abolished with immediate effect”.
The CBN said all segments of the foreign exchange market are now collapsed into the I&E window.
It added that applications for medicals, school fees, Business Travel Allowance/Personal Travel Allowance and SMEs would continue to be processed through the I&E window.
Experts spoken to by our correspondence welcomed the development, saying it will remove corruption, increase Forex inflow and boost economic development.
The apex bank action is in line with the directive by President Bola Ahmed Tinubu in his inauguration day speech, which was yet to be carried out by suspended CBN Governor Godwin Emefiele before he was edged out of office last week.
Emefiele is currently under probe for his conduct during his nine years in office.
Under Emefiele, the CBN resisted the pressure from World Bank and the International Monetary Fund (IMF) that the naira should be floated to determine its real value and eliminate the corruption embedded in the multiple exchange rates regime.
In the circular, the CBN also said that the operational changes to the foreign exchange market include the re-introduction of the “Willing Buyer, Willing Seller” model at the I&E Window.
“Operations in this window shall be guided by the extant circular on the establishment of the window, dated 21 April 2017 and referenced FMD/DIR/CIR/GEN/08/007.
“All eligible transactions are permitted to access foreign exchange at this window,” it stated.
According to the circular, all operational rates for all government-related transactions shall be the weighted average rate of the preceding day’s executed transactions at the I&E window, calculated to two decimal places.
“Proscription of trading limits on oversold FX positions with permission to hedge short positions with OTC futures limits on overbought positions shall be zero.
“Re-introduction of order-based two-way quotes, with bid-ask spread of N1. All transactions shall be cleared by a Central Counter Party (CCP).
“Re-introduction of Order Book to ensure transparency of orders and seamless execution of trades.
“The operational hours of trades shall be from 9 am to 4 pm, Nigeria time,” the circular said.
Also, there is a cessation of the RT200 Rebate Scheme and the Naira4Dollar Remittance Scheme, with effect from 30 June 2023.
Market-driven naira value excites financial experts
The Finance and economic experts, who welcomed the floating of the Naira are the President, the Association of Capital Market Academics, Prof. Uche Uwaleke; Chief Executive Officer, Centre for the Promotion of Private Enterprise [CPPE], Mr Muda Yusuf; Fiscal Policy Partner and Africa Tax Leader, PwC, Taiwo Oyedele; Chief Economist, PwC Nigeria, Andrew Neven; Managing Director, Arthur Steven Asset Management, Mr Olatunde Amolegbe; and President, Association of Bureaux De Change Operators of Nigeria (ABCON), Alhaji Aminu Gwadabe.
Others are Senior Credit Research Analyst, REDD Intelligence, Mark Bohlund; former Executive Director, Keystone Bank, Richard Obire; Director General, Manufacturers Association of Nigeria (MAN), Mr Segun Ajayi-Kadiri; Financial analysts, Renaissance Capital, Charles Robertson; and Managing Director, SD & D Capital Management Limited, Mr Gbolade Idakolo.
Uwaleke, who said that the unification of exchange rates would lead to “ a more transparent forex market,” however, advised the CBN to implement the policy ”in a way that it would not cause massive distortions in the general price level.”
He said: “The unification of exchange rates should not be a one-step process but should be implemented over a period of time however short it may be. Empirical evidence suggests that reforms are more successful when they are sequenced and implemented in phases. This is against the backdrop of the oil subsidy removal which, taken together, can result in galloping inflation and rising poverty levels. So, while fiscal and monetary policy reforms are welcome, absolute care should be taken to strike the right balance and minimise their unintended consequences.”
Yusuf said the policy would facilitate the mopping up of naira liquidity in the economy in the short to medium term.
That, according to him, will impact positively on inflation outlook and deepen the autonomous foreign exchange market through the liberalisation of inflows from export proceeds, diaspora remittances, multinational oil companies, diplomatic missions, etc.
He added that “the erstwhile foreign exchange policy regime was for all practical purposes, a fixed exchange rate regime that created distortions and negative outcomes.”
Yusuf said the distortions included “widening the gap between the official, other multiple windows and parallel market exchange rates, collapse of liquidity in the foreign exchange market and high demand for forex .”
He added: “It is important to reiterate that this is not a devaluation policy, it is a normalisation of the foreign exchange policy regime and an adjustment of rate to reflect the fundamentals of demand and supply. It would be dynamic, and the naira will appreciate or depreciate depending on the fundamentals.”
The expert advised the CBN to ”position itself for periodic intervention in the forex market, as and when necessary.”
Oyedele said the decision was a positive move that should bring more benefits than pains to the economy.
He outlined that with the market-driven rate, the aggregate demand for forex across markets should reduce as round-tripping incentive is removed, noting that avenues for corruption such as people who fake foreign travels just to get forex at discounted rates would be.
“Also, Nigeria’s sovereign credit rating should improve if this is complemented with the right fiscal and monetary policies thereby attracting more forex inflows and lowering the cost of borrowing,” Oyedele said.
In a 10-point impact analysis, Oyedele explained that while the decision expectedly would have some negative implications, the overall impact would be positive for the economy, government revenue and the capital market.
Neven expressed support for the policy as it would remove uncertainties and ensure transparency in the forex market.
“We had stated in a report to the CBN that as long as we don’t have a unified exchange rate, and there is a lack of transparency, nobody will invest in Nigeria. We will continue to have insufficient investment and growth and consequently remain poor. What we said years ago came to pass.
”During the (Muhammadu) Buhari Administration, the average growth rate was 1.5 per cent and the population growth was 2.7 per cent. So, it is a necessary condition to get enough investment into the country when we have a unified exchange rate.
“A situation where you have multiple exchange rates, where you don’t know how to have access to foreign exchange or at what price, simply is unworkable. Any system where you have to go to the CBN in order to access foreign exchange or get approval simply isn’t going to work. That is what has been proved over the last decade.
“I think the reaction to President Tinubu’s inauguration statement was very positive, and this latest statement is very positive. We view these as a necessary step toward economic recovery in Nigeria. We’re very much in favour of the unification of the exchange rate,” Neven said.
Ajayi-Kadiri said it was a “positive development and an indication of a far-sighted strategic choice”.
He said the policy, among other range of fiscal measures to promote domestic manufacturing, was borne out of a deep reflection on the current inclement manufacturing environment and the need to stop the drift into inglorious de-industrialization of the Nigerian economy.
The MAN chief, however, said in addition to pursuing the unification of the exchange rate, the CBN should be prevailed upon to take effective action to give priority to the allocations of forex to the productive sector, particularly to manufacturers to import raw materials, spares, and machinery that are not locally available.
Also, Amolegbe said the market-driven rate was another painful reform that needed to be done noting that the multiple exchange rate regime was not doing the economy any good.
“Not only did the former multiple exchange rate system discourage the inflow of much-needed foreign investments, but it also encouraged massive corruption. Harmonizing the rates should lead to better price discovery and hopefully lead to more transparent commerce. That is why the markets responded to it positively,” Amolegbe, a former president of the Chartered Institute of Stockbrokers (CIS) said.
Gwadabe said the removal of the rate cap would allow a true market clearance rate which has been the agitation of several stakeholders in the economy.
He said the move will harness and increase various sources of supply of dollars into the economy like foreign portfolio investment, foreign direct investment, diaspora remittances, and export proceeds, among others.
“The new directive, in my opinion, is to checkmate various illegal economic behaviours like rent-seeking, currency substitution, forex holding positions and frivolous demand in the market,” Gwadabe said.
Obire said eradicating multiple exchange rates would bring about increased dollar supply, and exchange rate stability.
Also, Bohlund said the unification would help the federal government to better balance its books as it is still highly dependent on dollar-linked oil revenue while spending is in naira.
While Robertson said that “Nigeria has become investable again, adding that attracting foreign money is wise when local savings are in short supply.”
Idakolo said the floating of the naira would lead to a free market system that allows market forces to determine the rate.
“This would allow availability to determine the rate and eliminate hoarding,” Idakolo said.
He added that the development “would also encourage foreign direct investment into the economy as restrictions limiting free flow has been lifted. In the long run, as the economy becomes stronger, the naira would begin to appreciate against the Dollar and the economic activities would now determine the strength of our currency going forward.”
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REA Targets 3.7GW Solar Manufacturing to Bridge Nigeria’s Power Deficit
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The Rural Electrification Agency (REA) has unveiled plans to establish 3.7 gigawatts (GW) of local solar photovoltaic (PV) panel manufacturing capacity by the end of 2027 as Nigeria intensifies efforts to expand electricity access and reduce dependence on imported renewable energy equipment.
Managing Director of the agency, Engr. Abba Aliyu, disclosed the initiative in Abuja during a benchmarking visit by officials of the Zanzibar Utilities Regulatory Authority (ZURA).
He said the agency is encouraging Chinese solar manufacturers to establish production facilities in Nigeria, noting that locally assembled solar panels are already being exported from Lagos to neighbouring Ghana.
According to him, the planned manufacturing expansion will significantly reduce imports while strengthening Nigeria’s renewable energy value chain. Aliyu attributed the rapid global growth of renewable energy to falling prices of solar panels and lithium batteries, saying technological innovation has made off-grid electricity the most cost-effective solution for millions of underserved communities.
He said Nigeria’s electricity access rate currently stands at 61.2 per cent, leaving about 80 million people without reliable power supply.
To address the challenge, REA has adopted a least-cost electrification strategy that determines the most suitable technology for each community rather than relying solely on national grid expansion.
The agency has mapped more than 700,000 communities nationwide, with plans to serve about 45 per cent through solar home systems, 31 per cent through mini-grids and the remaining 24 per cent through grid extension.
Aliyu added that REA has developed one of Africa’s most extensive geospatial electricity databases, covering more than 51,000 health facilities, 11,000 markets, thousands of schools, factories, dams, electricity feeders and existing mini-grids to support investment planning.
He noted that the agency’s interventions also target underserved communities receiving less than six hours of electricity daily. The REA boss warned that electricity demand would continue to rise sharply as Nigeria’s population grows, more sectors become electrified and emerging technologies such as artificial intelligence and data centres consume increasing amounts of power.
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Budget Office Explains PFIPC Allocation, Says Agency Emerged During Buhari Administration
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•Explains how PFIPC was allocated money in the budget.
The Budget Office of the Federation (BOF) yesterday explained that the Presidential Foreign Intervention Promotion Council (PFIPC), which the presidency declared as fake and is currently being investigated by the Independent Corrupt Practices Commission, ICPC, had its origin in the last administration of late President Muhammadu Buhari.
The Director-General of the Budget Office, Mr. Tanimu Yakubu who provided the explanation in a statement, after appearing before members of the House of Representatives, in Abuja said the PFIPC’s institutional origin was premised on the Presidential Economic Advisory Council inaugurated by President Muhammadu Buhari on October 9, 2019. He also explained how the fake agency was allocated money in the 2026 budget.
His words, “PEAC/PFIPC did not enter the 2026 Budget merely because it asked for funds. The Council had its origin in the Presidential Economic Advisory Council inaugurated during the administration of the late President Muhammadu Buhari on October 9, 2019. By the time preparation of the 2026 Budget began, official instruments had already been issued by the institutions charged with those functions.
“The Office of the Accountant-General of the Federation had assigned an administrative code to the PFIPC. The Office of the Head of the Civil Service of the Federation had approved an authorised establishment and a recruitment waiver. The applicable public-service salary structure also existed. These instruments did not come from the Budget Office. They came to it.
“The Budget Office did not create the Council. It did not assign its code. It did not approve its establishment. It did not grant its recruitment waiver. It received official instruments and did what the law required of it: it measured their fiscal effect.”
Mr. Tanimu further explained that the Council submitted a personnel estimate of N3.850 billion for the 2026 Fiscal Year and that his Office had to reduce that figure to N802.978 million, using the authorised establishment, the approved recruitment waiver, the applicable public-service salary structure and the extant costing methodology
According to the D-G, “Council later submitted a personnel estimate of N3,850,935,000.00. That estimate did not form the basis of the Budget Office’s recommendation. The Budget Office disregarded it and made an independent calculation using only the authorised establishment, the approved recruitment waiver, the applicable public-service salary structure and the extant costing methodology.
“That calculation produced N802,978,783.00. This was not a concession to the Council. It was the Budget Office’s own fiscal judgment. It was the amount placed in the Executive Budget proposal and later appropriated.
Mr Yakubu said that the Council could not receive the approved funds for personnel because its promoter, Prince Adeyemi Adeniyi could not secure Financial Clearance, an instrument that confirms that necessary fiscal and regulatory had been met.
He said, “Financial Clearance is the point at which a personnel provision may begin to acquire legal force as expenditure. It is not a routine letter. It is the confirmation that the fiscal and regulatory conditions for recruitment have been met. Until it is issued, the figure remains in the budget. It does not create staff. It does not open payroll. It does not produce salary. The Budget Office did not issue Financial Clearance for PEAC/PFIPC because the conditions were incomplete.
“The 2026 Appropriation Bill did not become law until Presidential Assent on 31 March 2026. Before that date, the Budget Office could cost the proposal. It could not grant final Financial Clearance against a bill that had not yet become law.
“After assent, a further condition remained outstanding. The National Salaries, Incomes and Wages Commission had not confirmed that the proposed staffing and remuneration arrangements complied with its prescribed template and the approved public-service compensation framework.
“The Budget Office could calculate the cost. It could not open the gate. There was therefore no Financial Clearance. There was no lawful recruitment. There was no payroll enrollment. There was no salary payment.”
The D-G added, “The personnel provision was N802,978,783.00. It represented 61.63 per cent of the total appropriation of N1,302,978,783.00. It has sometimes been described as though the Council could have received the whole amount and spent it at will. That description is false.
“Personnel appropriations are not paid to agencies as lump sums. After every legal condition has been met, salaries are paid month by month. The money moves electronically into the designated bank accounts of verified employees enrolled on the Federal Government payroll.
“The institution does not receive the annual personnel provision as cash under its control. Even in a lawful process, the Council would not have received N802,978,783.00 in one payment. The money would have gone over twelve months to individual employees. That process never began. No Financial Clearance was issued. No recruitment took place. No payroll record was created. No salary became due. Not one kobo of the personnel provision could lawfully have been drawn. Not one kobo was drawn. There is no personnel expenditure to recover because there was no personnel expenditure.”
The PFIPC controversy became public on June 11, 2026, when the Chief of Staff to the president, Mr Femi Gbajabiamila, declared the Council as fake and petitioned the law enforcement agencies.
However, at a press conference on June 26, the Director General of the PFIPC, Prince Adeniyi Adeyemi faulted the presidency’s disclaimer. He alleged that Gbajabiamila received N400 million through a proxy and demanded an additional N200 million to secure his appointment — an allegation which the Chief of Staff denied and has sued him to court claiming N15b as damages for defamation. Adeyemi is currently in custody after he was arrested by the police in connection with the PFIPC scandal and alleged forgery.
Before his arrest, Adeyemi claimed he personally approached officials of the budget office to seek the inclusion of the Council in the federal government’s budget.
Recently, Central Bank of Nigeria (CBN) confirmed that it opened two domiciliary accounts linked to the PFIPC on the directive of the Office of the Accountant-General of the Federation (OAGF).
The apex bank, however, said the accounts, one denominated in United States dollars and the other in British pounds sterling, were never funded or operated.
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BREAKING: Trump Applauds Tinubu’s Fight Against Terrorism, Pledges Continued US Backing
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United States President Donald Trump has commended President Bola Tinubu for what he described as his decisive leadership in tackling terrorism and insecurity in Nigeria, particularly attacks targeting Christian communities.
Trump conveyed the praise in a letter dated July 6, 2026, the contents of which were made public on Wednesday in a statement issued by the President’s Special Adviser on Information and Strategy, Bayo Onanuga.
In the letter, titled “President Trump lauds President Tinubu’s decisive leadership against terrorists,” the US President applauded Tinubu’s efforts to confront security challenges and reaffirmed Washington’s commitment to supporting Nigeria’s counter-terrorism operations.
“Thank you for your thoughtful letter. Your kind words mean a great deal to me, and I appreciate your decisive leadership on behalf of the Nigerian people.
“I applaud your resolve to tackle the issues plaguing your nation, especially the violence affecting Christian communities, and it is a true honour to stand with you in the fight against terrorists and to make the Federal Republic of Nigeria stronger and more prosperous,” Trump wrote.
Trump described the relationship between the United States and Nigeria as increasingly important amid growing security challenges across West Africa.
“The United States-Nigeria relationship is crucial at a time when conflict has spread across West Africa and around the world. We both share a mutual goal of confronting terrorism in all its forms, and our historic US-Nigeria 2026 Defence Cooperation Roadmap has established a robust framework to accomplish this feat,” he stated.
The US President also highlighted ongoing defence cooperation between both countries, noting that American Special Operations Forces had been deployed to assist Nigeria’s military.
“I am proud to have deployed the United States Special Operations Forces—among the most elite military units anywhere in the world—to equip the brave men and women in the Armed Forces of Nigeria with the skills, tools and intelligence they need to protect your homeland and ensure the safety and security of citizens, particularly those of faith who have been under attack.
“I look forward to our continued discussions over the course of my Presidency,” Trump added.
According to the Presidency, Nigeria and the United States have expanded security cooperation in recent months following the establishment of a Joint Working Group co-chaired by the National Security Advisers of both countries.
The collaboration has centred on intelligence sharing, military training and coordinated operations against terrorist groups.
The statement noted that one of the key outcomes of the partnership was the joint operation carried out on May 16 against ISIS hideouts in the Lake Chad region, which reportedly led to the killing of the group’s senior leader, Abubakar Al-Minoki, along with several of his lieutenants.
The Presidency also disclosed that the US Assistant Secretary of State for Africa, Frank Garcia, visited Abuja last week, where he held talks with senior Nigerian officials and pledged to deepen bilateral cooperation in security and other strategic sectors.
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