Nigerian foreign reserve hits 40.4 Billion US Dollars

The nation’s external reserves reached $40.4 billion as of January 5, its highest level since October 2014.

The increase is roughly $1 billion from December, the central bank said on Monday.

Successful debt sales, including multiple Eurobond offerings last year, have helped the Federal Government accrue billions of dollars in foreign reserves, although they remain far from the peak of $64 billion in August 2008.

Isaac Okorafor, spokesman of the Central Bank of Nigeria (CBN), in a statement said the central bank also injected $210 million into the interbank foreign exchange market on Monday, extending efforts to increase liquidity and alleviate dollar shortages.

A breakdown of the figure showed that the CBN offered $100 million to the wholesale sector while the small and medium enterprises (SMEs) and invisibles windows each received $55 million.

He said the new external reserves figure makes true the projection which Godwin Emefiele, CBN governor, made at the annual bankers’ dinner of the Chartered Institute of Bankers (CIBN) in November 2017.

Okorafor said the increase reflected the apex bank’s “strategy to effectively manage forex demand by various sectors of the economy”, stressing restrictions on access to foreign currencies for importers of certain items.

“Citing the CBN policy restricting access to forex from the Nigerian forex market by importers of some 41 items as the major turning point”, Okorafor said the policy had helped to stop the hemorrhaging of the country’s external reserves, which hitherto witnessed heavy depletion due to huge import bills and other debt obligations.”

Okorafor said the central bank policies “had ensured a decline in Nigeria’s import bills from over $5 billion monthly in 2015 to about $1.5 billion in 2017”.