The Nigerian Senate has introduced a new bill aimed at prohibiting the use of foreign currencies, such as the Dollar and Pound Sterling, for transactions and salary payments within the country. The proposed legislation has passed its first reading and seeks to amend the Central Bank of Nigeria (CBN) Act of 2007.
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,” was sponsored by Senator Ned Munir Nwoko, who chairs the Senate Committee on Reparations and Repatriation.
Senator Nwoko argues that the bill will strengthen the Naira’s position as Nigeria’s primary currency for all economic activities. He emphasized that mandating the use of Naira for all payments, including salaries and business transactions, will reduce the reliance on foreign currencies, address discriminatory practices, and restore confidence in the local currency.
The proposed law further stipulates that payments for exports, including crude oil and other commodities, must be made in Naira. By compelling international buyers to acquire Naira, the demand for the currency is expected to increase, potentially boosting its value.
Senator Nwoko described the continued use of foreign currencies for domestic purposes as a “colonial relic” that hampers Nigeria’s economic independence. He also stressed that expatriates working in Nigeria will be paid in Naira to align with the proposed reforms.
Another key aspect of the bill is the elimination of informal currency markets, which are often accused of undermining the formal economy. These markets have been linked to unethical financial practices, such as round-tripping by banks. Additionally, the bill proposes storing Nigeria’s foreign reserves within the country to reduce exposure to external economic vulnerabilities and strengthen national sovereignty.
The bill’s ultimate aim is to bolster the Naira, stabilize the economy, and reduce Nigeria’s dependence on foreign currencies for domestic transactions.
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