Nigeria is likely to lift the ban that prevents some importers from accessing foreign currency on the interbank market, Vice President, Yemi Osinbajo (photo) declared on Tuesday.

He said the Federal Government is considering putting in place policy-driven restrictions to encourage the manufacturing of 41 items like rice and toothpicks, locally. The lifting of the ban could ease foreign-currency trading restrictions placed by the Central Bank of Nigeria, as many importers access foreign currency from the black market at an additional rate of 30%.

“This is a good development for particularly small manufacturing companies; a number of them had been complaining that the supply of some of the items locally is small, some do not have local supply. Still, Nigeria does need to spur domestic production,” said Pabina Yinkere, head of institutional business at Lagos-based Vetiva Capital Management.

In June 2016, the Apex bank removed a naira peg of N197-199 per dollar while it continued with regular interventions in the interbank market to ensure that the naira does not weaken further below the 315 per dollar. Last month, the bank announced a new foreign exchange window for portfolio investors to trade currency at rates determined by the market.

“In stabilizing the macroeconomic environment, we have focused on aligning fiscal with monetary policy and nudging the central bank toward the objective of more market-determined exchange rates,” Osinbajo said.

Anita Fatunji