The Central Bank of Nigeria (CBN) has announced that the country’s external reserves reached $40.2 billion as of last Friday, reflecting significant growth from the previous year’s $34 billion.
Speaking at the IMF/World Bank Annual Meeting in Washington D.C., CBN Deputy Governor Muhammad Sani Abdullahi revealed that the bank is targeting $1 billion in monthly inflows as its policies take effect.
“We are building buffers to cover at least 14.3 months of imports for goods and services,” Abdullahi said, adding that efforts are underway to streamline export processes from farm gates to ports.
Additionally, he emphasized a major focus on diaspora remittances, which have doubled from $350 million to $600 million per month, aiming for $1 billion in the near term. Abdullahi stated, “We think this will significantly address domestic dollar demand.”
Finance Minister Wale Edun, on his part, highlighted the positive impacts of the fuel subsidy removal, noting that funds previously spent on inefficient subsidies will now be redirected to boost the economy. “The wasteful and inefficient 5% of GDP that was flowing out of Nigeria will now be available to develop and mobilize the Nigerian economy,” he said.
Edun also discussed how forex subsidies had shifted to the NNPC but expressed confidence in their ability to manage payables: “They have a route to paying down their payables and have already commenced that process.”
Addressing the role of the IMF in Nigeria’s economic policies, Edun emphasized the value of their technical advice but noted that Nigeria makes its own decisions: “You don’t always have to take advice, but we value their viewpoints.”
Meanwhile, the IMF has forecasted a decline in Nigeria’s debt burden.
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