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CBN Denies Forex Subsidy For Hajj Pilgrims

CBN Governor, Godwin Emefiele
CBN Governor, Godwin Emefiele

Governor of the Central Bank of Nigeria, CBN, Godwin Emefiele, has said that the apex bank did not subsidise foreign exchange for the 2016 hajj pilgrims.

The CBN had released a circular stating that forex would be made available to intending pilgrims at a subsidized rate N197 to a dollar.

Garba Shehu, Senior Special Assistant on media to President Muhammadu Buhari, on Friday defended the action on his social media pages.

He said, “The exchange rate of N197 to a dollar was approved by the President about three months ago, much earlier than when the new forex regime came into being.

“The Chairman of the Hajj Commission has confirmed that it is non-discriminatory. It was approved for Christian and Muslim pilgrimages for this year. The CBN has offered an explanation,” Shehu had said.

But the decision was widely criticized by Nigerians, most notably the presidential candidate of KOWA Party in the 2015 general elections, Oluremi Sonaiya.

“Why should we be subsidising forex for people who want to go for pilgrimage?” she wondered.

“I raised this issue when Christian pilgrims got concession last year and I asked Christian leaders to reject it. I said then that those interested in pilgrimage should be made to raise money to sponsor themselves.

“Why should we expect the country to be subsidising dollar for a few people? It is disheartening,” she lamented.

But on Tuesday, Emefiele Emefiele said the deal between the CBN and the pilgrims was consummated long before the new forex policy was implemented.

“Pilgrims made what is called advance payment for their personal travel allowance, in this case $750,” Emefilele said at a press conference.

“They make those advance payments to the state pilgrims board, and then the state passes it to the national body, who in this case has reached an agreement with the central bank about the appropriate rate that would be used.

“…It is important for me to go back. In 2015, when the market rate was 197, the pilgrims commission, Christians and Muslims, actually came to the central bank and agreed at N160 to the dollar, even when the market was 197. That was an agreement and a contract reached,” Emefiele explained.

He continued, “For 2016, the pilgrims commission came to the Central Bank of Nigeria, and we agreed that it had to be done at the market rate, which at that time was N197.”

“The contract was reached sometime around March and April this year. I would think it would be inappropriate at this time, because the exchange rate has adjusted, that we should go back to the pilgrims and pay the difference.

He said the CBN, as a business, could not breach a contract reached by both parties.