April 17, 2024

Executive Order Urged to Ban Cash Dollar Transactions and Save Naira


By: Emmanuel Ibitoye

Lai Omotola, the Group Managing Director of CFL Group, is urging President Bola Tinubu to issue an executive order banning cash dollar transactions to rescue the naira from further depreciation. Omotola emphasizes that despite various economic policies, the naira continues to lose its value, prompting the need for decisive action.

During a media briefing on ‘How to Save the Naira and Build a Robust Economy,’ Omotola proposes a comprehensive approach. He suggests that an executive order should ban all cash dollar transactions nationwide, making all such transactions bank-to-bank. Citizens and foreigners would be limited to holding a maximum of $100 in cash, with any excess automatically forfeited to the Federal Government.

Omotola further recommends a total prohibition of street vending of dollars and proposes a 90-day amnesty period for those making dollar cash payments. During this period, such cash lodgments would not be subject to investigation by any security agency. He emphasizes the need for scrutiny on every dollar payment from banks.

To promote a cashless economy, Omotola suggests that states with high economic activities, such as Lagos, Kano, Kaduna, Rivers, Enugu, and Abuja, should go 100% cashless. In these states, the maximum amount of cash one can hold would be set at N50,000.

The businessman also advocates for the revival of the Whistleblower Act, encouraging the government to offer rewards to individuals reporting hidden dollars seamlessly. He believes that implementing these recommendations could lead to a 50% appreciation of the naira within 30 days, with the exchange rate moving from N1,500 to between N700 and N800. By the year-end, he anticipates the emergence of the true value of the dollar to naira.

The Central Bank of Nigeria (CBN) and the Federal Government have been actively working to address the depreciation of the naira, with ongoing efforts to stabilize the currency. As of the latest report, the parallel market recorded a dollar selling at around N1,500, reflecting a N300 reduction from the previous close.

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