Exchange Rate Dollar To Naira Black Market Aboki
Introduction
The exchange rate between the dollar and the naira has been a topic of discussion in Nigeria for a long time. The scarcity of foreign exchange has led to the creation of a black market where the exchange of foreign currencies, including the dollar and the naira, takes place. In this article, we will discuss the exchange rate of the dollar to naira in the black market and the role of the Aboki in the exchange process.
Dollar to Naira Exchange Rate in the Black Market
The exchange rate of the dollar to naira in the black market is different from the official exchange rate set by the Central Bank of Nigeria (CBN). The official exchange rate is currently at 379 naira to one dollar, while the black market rate is much higher, ranging from 480 to 500 naira to one dollar.
The Role of Aboki in the Exchange Process
The term Aboki is a Hausa word that refers to someone who is not from the same tribe or ethnic group. In Nigeria, the term is commonly used to refer to Hausa traders who engage in the exchange of foreign currencies in the black market. These Aboki traders are usually found in major cities and towns across the country, and they play a crucial role in the exchange process.
The Aboki traders buy and sell foreign currencies, including the dollar and the naira, at the prevailing black market rates. They usually work in groups, and they are known to be very efficient in their trade. They have a vast network of contacts, including other Aboki traders, bankers, and foreign exchange dealers, which enables them to access foreign currencies easily.
The Risks Involved in the Exchange Process
The exchange of foreign currencies in the black market is not without risks. The Aboki traders are usually unlicensed, and they operate outside the purview of the regulatory authorities. This makes it difficult to regulate their activities and ensure that they follow the necessary procedures and guidelines.
Another risk involved in the exchange process is the possibility of receiving counterfeit currencies. The Aboki traders usually deal with large sums of money, and it is not uncommon for them to receive counterfeit currencies from unscrupulous individuals. This can result in huge losses for both the trader and the customer.
The Impact of the Exchange Rate on the Economy
The exchange rate of the dollar to naira has a significant impact on the Nigerian economy. The high exchange rate in the black market means that importers have to pay more for their goods, which ultimately leads to inflation. It also affects the purchasing power of consumers, as imported goods become more expensive.
The high exchange rate also makes it difficult for Nigerian businesses to compete with foreign businesses. Nigerian businesses have to pay more for imported raw materials, which raises their production costs and makes it difficult for them to compete with foreign businesses that have lower production costs.
The Way Forward
The Nigerian government has taken several steps to address the issue of the exchange rate, including the introduction of various foreign exchange policies. However, these policies have not been very effective in addressing the problem of the high exchange rate in the black market.
To address the issue, the government needs to create an enabling environment for businesses to thrive. This includes ensuring a stable exchange rate, improving infrastructure, and creating a conducive business environment. The government should also work towards reducing the country's dependence on imported goods by promoting local production.
Conclusion
The exchange rate of the dollar to naira in the black market has significant implications for the Nigerian economy. The Aboki traders play a crucial role in the exchange process, but there are risks involved. The government needs to take more effective steps to address the issue of the high exchange rate and create an enabling environment for businesses to thrive.