Market News

…As trans-border traders lament currency’s rapid fall against CFA

By Vera Wisdom-Bassey

Nigerian traders engaged in cross-border commerce have lamented the steady decline of the naira, describing ownership of the local currency as increasingly risky due to its continuous depreciation since 2023, which has now reached its worst level.

In previous years, the naira was widely accepted across West Africa, including Senegal, Côte d’Ivoire, Togo, Ghana, and the Benin Republic. Nigerian traders freely spent the currency in major markets across the sub-region, where it once traded stronger than the CFA franc. Those days, traders say, are now long gone.

Today, most traders in these countries no longer accept the naira because of its sharp loss in value. Only a few traders around the Seme border reportedly still take naira payments, and even then, goods are sold at much higher prices.

Official reports show that the naira depreciated rapidly in 2023, falling from above N1/1.5 CFA in the first quarter to N1/0.9 CFA in the second quarter and N1/0.8 CFA in the third quarter. After a brief period of relative stability in the fourth quarter, the currency opened in January 2024 at N1/0.66067 CFA. A second wave of depreciation in February pushed it further down to N1/0.38308 CFA.

Speaking with Sunday Sun, traders operating at the Badagry–Seme border in Lagos State and the Idi-Iroko border in Ogun State openly expressed their frustration, saying many have stopped sourcing goods from Cotonou due to unfavourable exchange rates.

One trader, popularly known as Iya Iyabo, said she has been trading between Nigeria and Cotonou for over 10 years. She became emotional while recounting how her purchasing power has dwindled.

“Two years ago, I could still buy small chicken or food to eat on the road when I travelled,” she said. “Now, I can’t even afford that.” She showed her empty bag, explaining that she returned from the market without goods because the naira could no longer cover basic purchases. She questioned the government’s response, saying, “Do they even care if we suffer? Nigeria was not like this before.”

Another trader, Mama Chisom, who trades between Nigeria and Ghana, said she now prefers to do business locally. A single mother whose husband died a few years ago, she explained that the low exchange rate has made foreign trips impossible.

“I can no longer afford travelling to Ghana to buy wrappers,” she said. “Things have turned upside down for me and my family.”

She added that cross-border traders are forced to change money at every border point, whether travelling to Benin, Togo, or Ghana.

“Before, with N100,000, you could get a large amount of CFA to buy goods,” she said. “Today, the same amount can barely buy anything.”

A bureau de change operator, Tunde Toheeb, attributed the naira’s rejection in Benin Republic and neighbouring countries to its weakness against the US dollar.

“Profit is no longer what it used to be,” he said. “They reject the naira because it can no longer buy quality goods. This has caused serious setbacks for us.”

He added that many traders now prefer CFA or the national currencies of non-Francophone countries to the naira at the Seme border.

Commercial motorcyclists, known as okada riders, are also affected. Isa Yakubu, a bike rider who transported this reporter from the Seme border to the Mile 2 (Mile 12/Misebo) market about 45 kilometres away said he prefers receiving payment in CFA rather than naira.

“If I collect naira, I lose money when I change it back,” he said, noting that the naira was once strong and widely accepted.

Another Nigerian woman who trades in provisions, wrappers, and fairly used clothing said most traders now insist on CFA payments.

“If you want to buy anything here, you must first change your naira to CFA,” she explained.

Observations at several border markets in Benin Republic and Nigeria revealed that many bureau de change operators no longer display Nigerian currency, unlike in previous years. Cross-border transporters also refuse naira payments, insisting that holding CFA is safer.

In the past, the naira dominated sub-regional trade and functioned as an unofficial convertible currency due to Nigeria’s economic influence. Today, traders say the naira has steadily lost value and has been widely rejected across West Africa for nearly two years.