The executive and the legislative arms of government appeared to be on a collision course over a recommendation by the former to the latter for a radical review of the Nigerian Foreign Exchange Act (NFEA) in order to empower the Central Bank of Nigeria to jail people hoarding dollars in Nigeria.
The Nigerian Law Reform Commission had recommended the review of NFEA to accommodate two-year jail term or fine of 20 per cent of the amount of the foreign currency held for more than 30 days.
The legislature is contending that making such legislation would scare away investors which the country most needed now.
Already, the Senate has thrown overboard the recommendation by the Nigerian Law Reform Commission to review the Nigerian Foreign Exchange Act in order to empower the CBN to jail dollar hoarders.
The Senate, in a statement signed by the Chairman, Committee on Media and Public Affairs, Senator Sabi Abdullahi, stated that with its focus on boosting investors’ confidence in Nigeria’s economy, such move, as proposed by the NLRC would prevent investors from making free entry and free exit from the market.
The statement reads: “The measure is disruptive and counterproductive, threatening to undermine many of the reform efforts already underway in the legislature and by government ministries, intended to boost investors’ confidence.
“The Senate would never pass such a punitive and regressive proposal.
“Overall, some of the commission’s recommendations have many sound attributes and could help Nigeria’s investment climate.
“We believe the CBN should have the authority to regulate the forex market and determine the exchange rate policy, as already enshrined in its enabling Act.
“A market-oriented exchange rate policy is the best recipe for guiding the operations of the foreign exchange market. This will ensure the supremacy of market mechanisms in efficiently allocating the scarce forex resources.”
The upper chamber of the National Assembly stated that it was committed to working with the executive to halt the worsening recession and return the country to economic growth.