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Senate moves against N35m BDC capital base

By BusinessNews Staff on July 2, 2014

The Chairman, Senate Committee on Finance, Senator Ahmed Makarfi, on Monday described as unfair the N35m minimum capital base imposed on Bureau de Change operators.

Makarfi, who addressed journalists in Abuja, however, said both chambers of the National Assembly were already making moves to intervene in the matter.

He said, “The House of Representatives has taken it up as a motion, but we in the Senate will adopt a different method to bring about dialogue between the operators and the regulators so that something more workable, more humane may emerge at the end of the day.”

He maintained that the Central Bank of Nigeria could only justify the imposition of huge capital base on the BDC operators if the regulatory agency had enough foreign exchange to sell to them at regulated rates.

He advised the apex bank should make the payment of the minimum capital base optional if it could not guarantee enough forex for all the operators.

He said, “If the reason for raising the capital base is because of scarcity of forex, that means government does not have enough to sell. There is no harm in making such a policy. If it wants to raise capital base for those that are buying forex, it may do so but the bulk of the operation of bureau de change should not be because they are going to buy from government.

“In other countries, government can sell forex to bureau de change in order to regulate exchange rate through various means. But the day-to-day activities of the bureau de change are not like that, they sell based on what they buy.

“With the minimum capital requirement, for you to open bureau de change, you should be allowed to operate and buy your forex where you can get them to sell and make a living but if the CBN is saying you need a minimum capital base of N10m or more before it can sell, then it must sell what is commensurate with what the capital outlined out. “The CBN should make it an option, pay the minimum capital base if you want to buy forex from the CBN or ignore the directive if you have an alternative way of sourcing forex.”

Makarfi asked the CBN to guarantee selling at minimum rate of exchange.

“For me, a policy like that could make sense if they have much to sell but to slam such a standard on everybody, without an assurance of what they can sell, that will be commensurate with the capital you are asking the people to tie down. I think it is not just; it is not fair; it is not equitable.”

Makarfi also cautioned the CBN Governor, Mr. Godwin Emefiele, against making sensitive statements that could affect his reputation.

Specifically, he faulted Emefiele for assuring Nigerians that he would reduce the interest rates on assumption of office only for him to withdraw the statement after consulting with the Bankers Committee.

Makarfi said, “Our leaders should always think before they talk, they should know the fact before they make a statement especially when they are occupying a sensitive position. It is not good you say something today and change your position tomorrow.

The senator described as wrong and unacceptable, the decision of an Abuja Federal High Court to stop the House of Representatives’ probe of the N10bn allegedly spent by the Minister of Petroleum Resources, Mrs. Diezani Allison – Madueke, to hire aircraft.

He said, “I think it was wrong for any court to stop the National Assembly from legislating or investigating. The National Assembly cannot stop any court from trying any case before it.

“Equally, the court should not interfere in the operation of the National Assembly to make laws or to investigate any matter. The court can find faults at the end of the day. If legislation is unconstitutional, the court has the power to annul such legislation.

[Punch]

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