Nigeria’s foreign exchange reserves have exceeded $40 billion, marking their highest level in 33 months, according to the Central Bank Governor, Mr. Olayemi Cardoso. This milestone was announced on Thursday during a symposium in Abuja, celebrating the first anniversary of the Central Bank’s current management team.
The event, coinciding with the release of a compendium titled “Promoting Stability in an Era of Economic Reforms: The Journey So Far,” highlighted the Bank’s recent economic achievements.
In his keynote address, Cardoso pointed to the Central Bank’s reforms as instrumental in achieving this growth, reflecting on the broader impact of these policies. “The reforms had started to yield positive results, including marked improvements in the FX market and a stabilisation of foreign reserves, which have now surpassed the $40 billion mark, the highest in 33 months,” he stated.
The Governor acknowledged the challenges of the economic environment over the past year, describing it as a period of transformation. He reported that inflation, which spiked to 24.1% in mid-2023, has shown signs of decline, underscoring the success of the Central Bank’s interventions aimed at restoring market balance and fostering economic growth.
“While noting that inflation remained elevated, he said it was on a downward trend, signalling that the reforms were taking hold in restoring market equilibrium and fostering growth,” the press statement read.
Among the key measures driving these improvements, Cardoso cited a significant adjustment in the Monetary Policy Rate, raised by 850 basis points to 27.25%, and an increase in the Cash Reserve Ratio for commercial banks to 50%. These policies, he explained, are designed to curb inflation and provide economic stability.
The Governor also outlined advancements in the foreign exchange market, particularly through the removal of multiple exchange rate windows, which had previously led to arbitrage and deterred foreign investments. He noted that this change had reduced FX settlement backlogs and curbed revenue losses, estimated at N6.2 trillion in 2022.
Another major element of the Bank’s strategy is to boost foreign remittances, with Cardoso reaffirming the goal of achieving $1 billion in monthly remittances, a move aimed at strengthening foreign reserves and promoting economic resilience.
He also detailed the CBN’s response to declining foreign direct and portfolio investments, including new regulations for Bureau de Change operators to foster stability in the FX market.
Cardoso highlighted the Bank’s commitment to digital innovation through its Digital-First Initiative, which has automated key operations, reduced costs, and introduced data-driven tools for better policy-making.
The CBN has also launched an Integrated Data Collection and Sharing Portal, along with an Investor Relations Unit, to create a more transparent, investor-friendly environment.
The Governor emphasized the importance of cooperation between fiscal and monetary authorities to ensure cohesive economic policies. Lagos State Governor Babajide Sanwo-Olu, present at the event, praised the CBN’s leadership for its commitment to transparency and self-assessment, stressing the importance of unity in addressing Nigeria’s economic challenges.
