In July, when Nigerian agritech startup Winich Farms shared its quarterly financial report with stakeholders, it reported all the figures twice. One version used the old official currency rate of around 460 naira per dollar, while the other featured the newer rate of 800 naira to a dollar. The company wanted to show its stakeholders how much it had grown during the quarter while revealing how much of that growth had been eroded due to Nigeria’s new foreign exchange policy.
In June, the naira went into a tailspin after the Central Bank of Nigeria (CBN) loosened its control of foreign exchange rates. In the past, CBN had followed a fixed foreign exchange policy that pegged the local currency at around 460 naira to a dollar. Under the new rule, CBN allowed the market to determine the daily exchange rates. This led to the naira’s official rate jumping to over 770 per dollar by mid-July.