- The Central Bank of Nigeria has introduced the yuan to Nigerians importing goods from China
- The apex bank is wooing local business owners to use the yuan when importing from China
- According to the bank, using the yuan instead of the United States' dollar will reduce pressure on the naira-dollar exchange rate
In its effort to support the naira and boost reserves, the Central Bank of Nigeria (CBN) is wooing local businesses importing goods from China to use the yuan instead of the United States’ dollar.
The Punch reports that the central bank officials on Wednesday, July 4, held a town hall meeting with businesses in Lagos to introduce the yuan for imports from China ahead of plans to start auctioning the Asian currency later this month.
Legit.ng notes that officials said: “The central bank will encourage users importing goods from China to use the yuan and not the dollar. Dollar demand burden arising from trades with China would be lifted from our forex reserves."
The officials stated that the purpose of the deal is to reduce the pressure on the naira-dollar exchange rate.
According to report, under the currency swap deal both countries signed, the CBN would hold N720bn in an account in favour of the People's Bank of China, while the Chinese central bank would hold 15 billion yuan, implying an exchange rate of N48 to the yuan.
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Meanwhile, Legit.ng previously reported that the Central Bank of Nigeria (CBN) said it executed a $2.5 billion bilateral currency swap agreement with the Peoples Bank of China (PBOC).
Godwin Emefiele, the governor of the CBN, led his operatives while PBOC boss, Yi Gang, spearheaded the Chinese team at the official signing ceremony in Beijing, China on Friday, April 27.
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