WOW! Britain To Accept The Naira In Trade Transactions
After the rain comes the shine, says an adage.
As far Nigeria’s embattled currency, the naira is concerned, there couldn’t be a better time than now.
The UK has announced it has added the local currency to its list of “pre-approved currencies”, allowing it to provide financing for transactions with Nigerian businesses denominated in the local currency.
This makes the naira one of three West African currencies that UK Export Finance has pre-approved for its programme of funding transactions that promote trade with Britain.
Perhaps, this also provides opportunity for the local currency to inch its way into global trade currencies.
Analysts believe this is one of the positive spin-off of Britain’s decision to leave the European union in 2016.
Britain voted in 2016 to leave the European Union, which has forced London to rethink its trade ties with the rest of the world.
“This is a clear indication of how much value the UK places on its relationship with Nigeria,” Paul Arkwright, the British High Commissioner to Nigeria, said in the UK’s credit agency statement.
Read More: PwC Scared For The Naira
“It will provide a firm foundation for a significant increase in trade and investment between both countries,” the statement added.
The naira financing will follow the same structure as a someone buying in sterling, except that Nigerian firms taking out a loan in the local currency can benefit from a UK government-backed guarantee.
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