– Lowest ever $23Bn in Oct 2016
– Highest $62Bn in Sept 2008
By Codratus Godson
Nigeria’s foeign reserve has continued to fly high and higher every month in recent times. The Central Bank of Nigeria (CBN) which released the latest figures said it good fortunes are because of rebound in oil prices, meaning that that nation is now seeing the benefit of oil boom. The other reason they gave is that import is drastically being reduced, export of non-oil goods is rising, and rice sufficiency has reduced huge import bills. They also gave another sterling reason, foeign investors are coming in with capital.
Fact remains that wherever foreign reserve begins to grow, there are international hawks that smell it out fast and begin to circle and descend to participate. At the slightest sign of danger, they are also the first to flee. For now, while most Nigerians only see the negative sides, others seem to be seeing the positives. A country with steady growing foreign reserves usually attracts global attention especially in the business capitals of the world.
Capitalists and business experts around the world usually monitor indicators such as foreign reserves, exchange rate, GDP, per capita, interest rate, cash reserve ratio, inflation rate, repopulation growth rate, etc. Often, they may ignoresome of the internal behaviours such as human rights, nepotism, corruption, crime rate, insurgency, etc, in making some aspects of their decisions. That could explain why many countries still do business with North Korea, if not the barking of the United Nations. China with all the defects in human rights and democracy still post one of the best economic indices and they are doing business with almost every country of the world.
Now, for Nigeria to continue to post steady rise in foreign reserves and for it to now grow at about $3Bn per month, many see the possibility of it hitting an all time high of $76Bn by end of the year, when in fact the CBN had predicted $40Bn. The BN boss has since reversed his forecast to $55Bn by end of the year.
Remember that the highest Nigeria ever had was $62Bn in 2008, and the country did a great thig with it by buying back its foreign debts with $12Bn out of it. This shows what corruption is eating away. If Nigeria can save, it can buy back its credibility and viaility with about $20Bn and surge forward with it.
The Actng Director of Communications of the CBN, Mr Isaack Okoroafor, has announced that Nigeria’s foreign reserves hit $46bn on Friday, March 9th, 2018. A statement said the reserves grew by about $3.2 billion between February and March 2018.
The reserves at the beginning of 2018 stood at $39.3Bn, then rose to $42.8 in February before hitting the new high of $46 billion.
Okorafor attributed the continued accretion to the country’s reserves to “the Bank’s effort at vigorously discouraging unnecessary importation and reducing the nation’s import Bill; inflow from oil and non-oil exports, as well as the huge inflows through the investors and exporters window of the foreign exchange market,” which he said had attracted over $33 billion since April 2017, when it was created.
At the close of commodities trading on Friday, March 9, 2018, Brent Crude, sold at $65.49 a barrel up by 2.54%.
According to him, “the Bank’s interventions in the foreign exchange window had also helped to moderate the pressure on the FOREX reserves by sustaining liquidity in the market and boosting production and trade.”
Okorafor also noted that the CBN policy restricting access to FOREX from Nigeria’s foreign exchange market to importers of some 41 items had made a huge impact on the status of Nigeria’s reserves and boosted the supply of local substitutes for imported goods, created jobs at home and enhanced the incomes of farmers and local manufacturers.