Nigeria central bank pays nearly $2 billion towards Foreign Exchange backlog

Nigeria's central bank has paid nearly $2 billion in outstanding foreign exchange forwards in the last three months in a bid to clear a backlog of dollars, a spokesperson has said, but forex shortages continue to hobble the country's naira currency.

Africa's biggest economy has nearly $7 billion in forex forwards that have matured, a major concern for investors, but the Central Bank of Nigeria (CBN) has promised to pay up to boost confidence in the foreign exchange market.

"In the past three months, the CBN has also redeemed outstanding forward liabilities amounting to almost USD 2 billion," acting spokesperson Hakama Sadi Ali said in a statement late on Sunday.

"This underscores the Bank's commitment to the resolution of pending obligations and a functional foreign exchange market."

Nigeria's foreign currency shortages have been worsened by declining oil production, which is the country's largest export, accounting for more than 90% of dollar inflows.

Ali said the CBN had recently paid $61.64 million to foreign airlines, who sold tickets in the local naira currency but have not been able to get their money out of the country.

Foreign airlines were owed more than $700 million at the end of November.

"These payments signify the CBN's ongoing efforts to settle all remaining valid forward transactions, with the aim of alleviating the current pressure on the country's exchange rate," Ali said.

President Bola Tinubu has promised to boost foreign currency inflows into Nigeria by attracting new investment, ramping up oil production and reforming the foreign exchange market. 

By Camillus Eboh, Reuters

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Port Harcourt oil refinery to complete test run this month

Nigerian state-owned oil firm NNPC Ltd will complete test runs at the Port Harcourt refinery in the south this month, in a major step towards resuming operations five years after the plant was shut, the company said on Thursday.

"Testing will conclude shortly, ensuring the refinery's efficient operation. That phase will be completed this month," NNPC spokesperson Femi Soneye said.

The refinery, which is undergoing an upgrade, will begin by processing 60,000 barrels per day, and NNPC expects to operate at the full capacity of 210,000 barrels per day later this year.

Port Harcourt is among Nigerian state-owned refineries that have been mothballed for years, but which the government is trying to revive to end the country's reliance on imported refined products. 

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Anti-graft body of Nigeria visits Dangote Group in forex probe

Nigeria's economic and financial crimes agency on Thursday inspected Dangote Group's books as part of investigations into possible past misuse of foreign currency sourced from the central bank, two sources at the agency said.

The Dangote Group, which counts cement and fertiliser manufacturing and sugar refining among its businesses, is owned by Africa's richest man Aliko Dangote. Dangote is also readying a 650,000 barrels per day oil refinery that cost $20 billion to build.

Under former Central Bank of Nigeria (CBN) governor Godwin Emefiele, the bank had multiple exchange rates and sold dollars cheaply to some businesses, including Dangote, to help them import raw materials.

A Dangote spokesperson did not immediately respond to requests for comment.

Two people at the Economic and Financial Crimes Commission (EFCC) said Thursday's search at Dangote offices in Lagos, was part of an investigation set to be expanded to other companies.

"We went to the head office of Dangote Group today to look into their books on the ongoing investigation on the abuse of the extant laws that govern the foreign exchange transaction during the tenure of Godwin Emefiele as CBN governor," one of the sources told Reuters.

"Here, we are talking about multiple exchange rates and others. It is an ongoing investigation and it was the turn of Dangote Group today," said the source, who declined to be named because he is not authorised to speak on the issue.

EFCC spokesperson Dele Oyewale declined to comment.

A second source confirmed the investigation, adding that at least one other listed Nigerian conglomerate would be targeted.

By Camillus Eboh, Reuters

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