The Central Bank of Nigeria (CBN) has announced a significant boost to the nation’s external reserves, reaching $42.01 billion as of December 12, 2024.
This development, according to the apex bank, is sufficient to finance over nine months of imports in 2025, far exceeding the international benchmark of three months.
CBN Governor, Mr. Olayemi Cardoso, made this declaration while presenting the bank’s performance report to the Senate Committee on Banking, Insurance, and Other Financial Institutions.
He stated, “External reserves rose from $38.35 billion on September 30, 2024, to $42.01 billion by December 12, 2024, driven largely by crude oil-related taxes and third-party receipts in the third quarter of 2024.”
Cardoso highlighted the importance of the reserves as a buffer against economic shocks.
“Our current account surplus and improved trade balance have contributed to this robust financial position,” he said.
Diaspora Remittances Soar by 61%
The Governor also disclosed a remarkable increase in diaspora remittances.
From January to October 2024, remittances through International Money Transfer Operators (IMTOs) reached $4.22 billion, a 61.1% increase from $2.62 billion during the same period in 2023.
Cardoso attributed this growth to enhanced remittance processes and policies introduced by President Bola Tinubu.
“Monthly remittances rose from $336.61 million in September 2024 to $402.38 million in October 2024,” he added.
He expressed optimism that remittance inflows would continue to rise, further boosting the nation’s foreign exchange position.
Policy Actions and Economic Outlook
Governor Cardoso reassured Nigerians of a brighter economic future in 2025.
He emphasized measures aimed at stabilizing the forex market and recapitalizing the banking sector.
“Despite challenges, there are clear reasons for optimism, with positive growth trends in key sectors like services paving the way for recovery,” he said.
On tackling cash shortages, the CBN has imposed a fine of N150 million on any bank branch caught distributing new naira notes to currency hawkers.
Senate Expresses Concerns
The Senate Committee on Banking commended the progress but raised critical issues.
Chairman Mukhail Abiru urged the CBN to address high-interest rates, which he said stifled economic productivity and access to credit.
“Productivity cannot thrive in a high-interest rate environment,” he stated.
Abiru also called on the CBN to clear an outstanding $2.4 billion foreign exchange forward contract, which has sparked petitions from businesses.
Inflation and Agricultural Output
Inflation, particularly in food prices, was another concern.
Abiru stressed the need to increase agricultural output to ease inflationary pressures.
He also recommended targeted interventions for small and medium enterprises (SMEs) to drive economic growth and achieve the $1 trillion economy target.
“The bank should resume interventions through development financial institutions to support productivity,” he said.
Cash Scarcity and Banking System Failures
The committee criticized the ongoing cash scarcity and the poor state of naira notes in circulation.
Abiru lamented the difficulty in accessing cash from ATMs and the prevalence of dirty and mutilated notes.
He also condemned excessive bank charges, unresolved customer complaints, and failed online transactions.
“These issues undermine public confidence in the banking system,” he warned.
