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    Much has been said and celebrated this week about the Nigeria - China Forex deal, but much is undoubtedly yet to be understood about the deal leading to all sorts of interpretations and postulations from different school of thoughts on whether we should at all be celebrating or how loud we should indeed celebrate. As it turns, and like in all other issues 'Nigerian', the school is quite a large one, with discussion participants ranging from Market Women to Economic experts all expressing their opinions even before President Buhari and his team returned to Nigeria with details of the deal. To this end, we are going to attempt to throw some more light on this issue as we see it in the proceeding write up. Please note that this is a very simplified version of the story, brought down to level of the man in the streets. Also note that the figures used here are not the exact rates, but convenient approximations for ease of calculations so as to drive the important points home.

    For international transaction between two countries to work, there must be a mechanism for the two different to exchange their currencies via their Central Banks to settle the transactions .e.g. if Nigeria buys 600 Chinese Yuan worth of products from China and China buys N20 worth of products from Nigeria, it means currency has to be exchanged between these two parties at an exchange rate of 20 to 600, i.e. 2 to 60 or simply put, a ratio of N1 to Y30 .
    However, there are over 200 currencies in the world today and not every country has the wherewithal to do exchange settlements with every other 199 countries at the same time, most countries just cannot afford it. America is however big enough to do this so for countries who cannot afford it the dollar now becomes the standard international exchange currency. i.e. You can exchange your currency to the US Dollar, and then the US dollar can then be converted to any currency of your choice. This is essentially what is meant when we refer to the dollar as an international Medium of exchange.There are other internationally exchangeable currencies e.g. Euro, Pound etc but they are not as convertible as the dollar.

    Before now the Chinese currency (Yuan) was not easily convertible to the Naira because both countries' Central Banks do not store their reserves in each others currency, thus the only way to transact between China and Nigeria was to first convert either currencies to the dollar. In line with this,facts recently made available showed that 70% of the Nigerian demand for the dollar was to convert eventually to the Yuan to conclude transactions between Nigeria and China. This multiple currency conversions inflates currency price due to what economics call TRANSACTIONAL COSTs .e.g. The bank has to make profit,the Nigerian selling to the black marketers has to make profit and also the black market sellers have to make their profit. This is further complicated by demand,supply and availability issues, adding to the cost of exchange rate.

    With this recent agreement between Nigeria and China, the Chinese currency and Nigerian currencies are now directly inter-convertible via their central banks, meaning Nigeria will make Naira available to the Chinese central bank and vice versa. This will enable Nigeria and Chinese business men and women trade together easily knowing their governments will settle the transaction using the prevailing exchange rate. Thanks to this , the cost of converting from the naira to the yuan will no longer be impacted by transactional cost of passing through an intermediary currency - the dollar. This means that it will now be cheaper to convert from naira to yuan.
    For example, prices listed on a popular Chinese trading portal, which quotes the price of goods in both yuan and US dollar, shows a particular leather Handbag quoted as 297yuan or 46dollars, this shows that the dollar exchanges for about 6.5 yuan. Therefore, a Nigerian who wants to buy this bag now has the option to pay in dollars or pay in yuan with varying consequences as follows;

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    by AG | Feb 08,2017

    david and victoria

    On Monday, David Beckham and his wife, Victoria, were seen in two different cities.

    While the former footballer was spotted in London, his wife stepped out in NYC on Monday, ahead of the New York Fashion Week.

    Their separate appearance is coming on the heels of David Beckham’s email drama over the weekend. In typical Victoria fashion; the former Spice Girl kept a straight face while being [hounded] by the paparazzi.

    Over the week David [was] entangled in a £1 million ($1.2 million) blackmail plot. An email leaked by hackers; shared a 2013 conversation between the footballer and his publicist purportedly; detailing him fuming over being denied a knighthood due to tax reasons.

    The email alleged that David used his UNICEF charity work to campaign for a knighthood.

    David Beckham was spotted in London while his wife, Victoria, stepped out in NYC. (Photos: Splash News)

    Daily Mail reports that the email went public after Beckham’s representatives refused to comply with hackers’ demands.

    A source who spoke with the news outlet revealed that Beckham [was] only caught in the cross fire

    In some of the supposed damaging exchanges; Beckham — who [was] awarded an Order of the British Empire in 2003;  allegedly [complained] that British singer Katherine Jenkins [was] also awarded an OBE; and called it “a f***ing joke.”

    Beckham also supposedly called the committee that determines the honorees; “a bunch of cs” and said he “expected nothing less.” He also allegedly dismissed lower honors, ranting, “Unless it’s a knighthood, f off.”

    His rep in reply urged him to focus his energy on his charitable efforts; like UNICEF, which he’s been an ambassador for since 2005.

    In the email, he allegedly wrote; “It’s a disgrace to be honest; and if I was American I would [have] got something like this 10 years ago.”

    Meanwhile, neither David nor Victoria have directly spoken out about the email leak.

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