FX Fallout: Nigerian Manufacturers Slam Banks Over Dollar Dispute

Nigerian manufacturers say they’re facing undue pressure from banks over billions in unsettled foreign exchange (FX) forward contracts—remnants of the country’s now-abandoned fixed exchange rate regime. According to the Manufacturers Association of Nigeria (MAN), companies have had accounts frozen and are being harassed to repay dollar obligations the Central Bank has yet to fulfill. These contracts, meant to ease FX access, have backfired as the naira’s steep decline, down 70%, has exacerbated the crisis. While the Central Bank claims to have cleared $7 billion in backlogs, the commercial lenders insist $2.4 billion is still outstanding. Now, MAN is urging authorities to settle the debt swiftly and shield manufacturers from further financial strain.

Bloomberg