Africa in the news: Nigeria introduces new foreign exchange window, U.S. Defense Secretary visits Djibouti, and Burundi denies access to WFP convoy

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Nigeria’s central bank opens a new foreign exchange window to attract investors
On Monday, the Central Bank of Nigeria introduced a new window for investors and exporters to engage in foreign exchange trading. The platform—called the Investors’ and Exporters’ FX Window—aims to boost the availability of U.S. dollars in the economy. The window allows sellers and buyers to conduct currency trades via phone at rates determined by the market, falling between the official interbank rate and the black-market rate. Banks, portfolio investors, exporters, and the central bank will sell hard currency to interested buyers via this platform. Those eligible to purchase dollars through the new system include people and businesses using dollars to repay loans and loan interest, pay dividends, repatriate capital, or resolve trade-related obligations. By creating a market where the naira can be traded at a weaker value than the official interbank rate for certain transactions, the platform strives to attract foreign investors and improve the supply of U.S. dollars in the economy, without policymakers resorting to floating or devaluing the currency, which could lead to an inflationary spiral.


On Wednesday, the naira closed at 380.39 on the new foreign exchange trading window while the naira’s official interbank market rate stood at 305.90 naira and the black-market rate was 388 naira. With the advent of the new window, Nigeria now has six exchange rates: the new rate, the official interbank rate, the black-market rate, a rate for Muslim pilgrims going to Saudi Arabia, a retail rate set by licensed exchange bureaus, and a rate for foreign travel and school fees.
Pentagon chiefs visits Djibouti and issues a warning against piracy
This week, United States Secretary of Defense Jim Mattis was in Djibouti where he met with President Ismaïl Omar Guelleh to advance U.S.-Djibouti efforts towards promoting regional stability as well as visit ...

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