EFCC hunts down forex hoarders as scarcity bites harder

Nigeria’s anti-graft agency said it would arrest foreign currency traders found to be hoarding the dollar after a plunge in the country’s currency last month.

Choked supply chains, partly due to Russia’s invasion of Ukraine, and an almost 100 per cent increase in gasoline prices this year, are placing upward price pressures on Africa’s largest economy.

The Economic and Financial Crimes Commission called foreign exchange dealers to a meeting in a bid to end “brazen foreign exchange speculation” that’s causing “a run on the value of the naira,” the agency said. It has intelligence linking some persons and organisations to the hoarding of foreign currencies, it said.

It warned “those involved to desist or risk arrest as a major offensive against the speculators is under way.”

Nigeria is poised to lose its frontier market status because of persistent foreign-exchange shortages in Africa’s largest economy.

MSCI Inc. is considering downgrading the MSCI Nigeria indexes to standalone markets status from frontier market, the New York-based company said in a statement.

Africa’s largest economy has been rationing dollars following the drop in income from oil which accounts for about 90 per cent of its foreign exchange earnings. The nation also suffers theft of crude oil and uses petroleum revenue to subsidize gasoline prices. The shortage of dollars at the banks is forcing many individuals and businesses to access them on the black market.

For people changing money on the street, the nation’s currency has strengthened in recent days, at least partly due to increased surveillance from the authorities.