The Chairman of Airpeace, Chief Allen Onyema just made a tactical mistake by opening his offshore account in US.
What he did was a normal practice among all the businessmen in Nigeria.
I will explain in a lame man language now and I will use the industry that I’m familiar with as an example.
Let’s take newsprint and Petroleum import letter of credit as an example. The first assignment of any successful business men in Nigeria is to open a foreign account abroad like Panama and all these Islands.
Some of our business men who do not have the opportunity to be born abroad will buy foreign passport where it’s necessary and some countries allow Nigerians to open account in their country if they have Visa.
The same business man will look for the price of a bundle of Newsprint; will return to Nigeria to apply for loan to buy it with cost price triple the amount quoted by the Newsprint Company he visited abroad.
He will use the company he opened abroad to raise an overpriced invoice he intended to use to collect the loan from Nigeria.
With the help of our ready to help bankers (most of them knows what’s up).
Let assume original cost price of the Newsprint is $100 with the exchange rate of N200 per USD. He will use his company abroad to raise invoice of $300.
He will apply for letter of credit of $300.
When the $300 is credited to his account abroad, he will use $100 to buy the Newsprint and transfer the remaining $200 back to his account in Nigeria.
That was what we normally referred to as round tripping. The $200 will now be exchanged at black market rate of N360.
Now, the smart business man made N160 on every dollar he collected as a loan from his bank in Nigeria.
The big men among them don’t think of paying the loan back. They continue with their business and some will pay the bank back at the official rate of N200. Some will keep the dollar deferential in their offshore account if there is speculation that CBN will devalue Naira.
That’s how our business men made huge money and become big men overnight.
May Allah help Nigeria and Nigerians.
As in, the more you look the less you see. If you are not part of the mafia, you will run and run and die here.
I’m Wole Arisekola from Ibadan.