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June 18, 2024

The impact of the exit of NEIC (5), by Eric Teniola 

Who else but Professor Benjamin Nwabueze (2), by Eric Teniola

From last week, continues the narrative  on  the National Economic  Intelligence Committee, NEIC, its powers, functions  and how it was able to discharge these, including its recommentations on monetary policy during the Gen Abacha regime

ALTHOUGH General Sani Abacha abused the system by enriching himself fantastically, it was Professor Aluko’s committee that pegged the official rate of N22 to $1. 

The committee also recommended the following: There will be no bidding or allocation of foreign Exchange at the CBN, every company, individual or organisation shall source foreign exchange requirements in the autonomous market; CBN shall hold the official foreign exchange, and from time to time, intervene in the autonomous market; all government parastals, government companies, agencies and government majority owned companies and organisations, exploration and production oil companies, and oil service companies, recipients of foreign loans and grants must continue to maintain these foreign exchange … domiciliary accounts with CBN which shall purchase such funds as and when necessary at the prevailing autonomous rates; operation of the domiciliary accounts shall be authorised and export proceeds and other repatriation in-flows shall be held in domiciliary accounts which shall be held and maintained with any authorised bank in Nigeria. 

The beneficiaries of domiciliary accounts shall have unfettered use of funds contained therein; interbank autonomous market shall operate freely; and for the avoidance of doubt, no oil processing company shall be permitted to operate a foreign exchange market in Nigeria. The main actors in IFEM shall be the bank and bureau de change, with CBN intervening from time to time; and bureau de change shall be allowed to buy notes and coins and travellers cheques freely but shall sell only notes and coins up to a maximum of US$2500 per transaction. Buying and sale of notes and buying of travellers cheque by bureau de change shall be at autonomous market rate subject to a margin of two per cent. 

For better or worse, the committee also recommended the promulgation of Failed Banks (Recovery of Debts) and Financial Malpractices in Banks No. 18 of 1994, Advance Free Fraud and other Fraud Related Offences Decree 1995 (otherwise known as “419 decree”) and the Money Laundering Decree of 1995.

Persons charged under the decree are to face the Miscellaneous Offences Tribunal. 

To be concluded