The Minister of Finance and Coordinating Minister of the Economy, Wale Edun, has stated that Nigeria is currently recording a net inflow of approximately $2.35 billion into the apex bank’s foreign reserves.
This development indicates a positive trend in the country’s foreign exchange position.
Edun disclosed this in a statement while speaking at the Access Bank annual cooperate forum of 2024 in Lagos, according to Nairametrics.
He noted that the increase in foreign reserves has played a crucial role in stabilizing the naira in the foreign exchange market.
The Minister mentioned that this positive trend has been consistent over the past seven months of 2024.
“We have relative currency stability. And of course, the all important margin of the rates. We’ve seen a gradual elimination of multiple exchange rate.
“We also have foreign exchange liquidity. The gross reserves are up. There have been a net inflow in the first seven months of this year of about $2.35 billion every month.
“On the fiscal side as well, government revenues are growing and the key to government revenue is not so much that government has revenue to compete with the private sector.
“It’s the fundamentals, the social and the key infrastructure spending. The social safety net spending. And historically, our figures are low. Our tax to GDP ratio is as low as 10%. Our revenue to GDP is also around 15%,” Edun said.
The Minister emphasized that the government is focused on increasing crude oil production as a means to bolster fiscal revenues.
He indicated that Nigeria is on track to achieve the target of 2 million barrels per day by the end of 2024.
Additionally, he mentioned that the government is implementing policies aimed at diversifying the economy to reduce dependency on oil revenues.
“There is a commitment to ramp up oil production to 2 million bpd before the end of the year.
“In addition, our exports need to be significantly diversified and an important area we need to look at is the services. We have the demographics as well as the relatively skilled population which means we can export our services,” he added.
According to the Central Bank of Nigeria, the country’s foreign reserves have risen significantly in recent months, driven by increased interest rates and the devaluation of the naira.
These factors have made Nigeria an attractive market for foreign portfolio investments. Recent reports indicate that foreign reserves reached a historic high of $34.66 billion as of June 2024.
