Nigeria’s External Reserves Near 2-Year High of $37.31bn

By Adedapo Adesanya

Nigeria’s external reserves have reached a near 2-year high of $37.31 billion, according to the data from the Central Bank of Nigeria (CBN) as of September 18, 2024.

This development reflects significant foreign inflows into the country’s economy, which has been battered in recent times.

The last time the reserves hit the highest level was on November 4, 2022, when they stood at $37.36 billion.

On a year-to-date basis, the country’s reserves surged by 12.99 per cent or $4.29 billion from the $33.02 billion recorded at the start of the year on January 2, 2024.

The rise in the country’s external reserves can be attributed to a lot of things, including the recently concluded federal government’s domestic dollar bonds, which attracted foreign investment; increased remittance inflows from Nigerians abroad; multilateral loans from international organisations; and foreign portfolio investments (FPIs).

When compared year-on-year, Nigeria’s foreign reserves grew by 12 per cent, adding $4.03 billion to the $33.28 billion recorded on September 18, 2023.

Recently, the federal government raised over $900 million from investors through the issuance of the $500m local bond programme.

The raise is the first series of the $2 billion domestic US Dollar bond aimed to stabilise the economy.

There was also a record of $553 million in remittances in one year, between July 2023 and July 2024, according to the apex bank.

Other inflows into the country’s economy within the period include $3.3 billion AfreximBank crude oil facility and $2.25 billion from the World Bank Group.

The foreign exchange inflows through the economy surged by 57 per cent in one year following consistent policies by the CBN.

Data from the CBN showed that the country recorded $8.86 billion in FX inflow in February 2024, higher than $5.66 billion in the corresponding period of February 2023.

The CBN’s economic report for February 2024 noted that new investments into the economy increased significantly to $1.24 billion, compared with $0.33 billion in January 2024.

Foreign Direct Investments (FDIs) inflow rose to $0.06 billion, from $0.03 billion in the preceding month. Portfolio investment inflow increased to $0.80 billion from $0.12 billion, following rising returns on money market instruments and bonds.

Similarly, other investment capital, mainly loans, rose to $0.37 billion, from $0.18 billion in the preceding period.