The Nigerian Senate has taken steps to restore the country’s monetary independence by proposing a bill to prohibit the use of foreign currencies for payments and transactions within Nigeria. The bill, titled “A Bill for an Act to Alter the Central Bank of Nigeria Act, 2007, No. 7, to Prohibit the Use of Foreign Currencies for Remuneration and for Other Related Matters,” is sponsored by Senator Ned Munir Nwoko, Chairman of the Senate Committee on Reparations and Repatriation.
Senator Nwoko explained that the growing reliance on foreign currencies like the Dollar and Pound Sterling has weakened the Naira and undermined economic stability. He described the practice as a colonial remnant that continues to hold back Nigeria’s financial independence.
The proposed legislation seeks to mandate the use of the Naira for all domestic transactions, including salary payments for both local and expatriate workers. It also proposes that crude oil and other exports be paid for exclusively in Naira, requiring international buyers to purchase the local currency. This, according to Senator Nwoko, will drive up demand for the Naira and strengthen its value.
The bill also aims to abolish informal foreign exchange markets, curb unethical banking practices like round-tripping, and reposition the Naira as the dominant currency in Nigeria’s economy. Additionally, banks will be required to provide loans at affordable interest rates to support industrialization and reduce reliance on imported goods.
Senator Nwoko assured that access to foreign exchange for travel and legitimate needs would remain available through streamlined banking reforms. He also stated that transitioning domiciliary account balances to Naira would be a voluntary process, with the expectation that a stronger Naira would eventually reduce the need for foreign currency holdings.
Drawing from Morocco’s example, where the Dirham has remained stable against major currencies for over three decades, Nwoko expressed confidence that Nigeria could achieve similar results with the right policies. He added that the bill could transform Nigeria’s economic outlook, promoting self-reliance, strengthening the Naira, and driving sustainable development.
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