The Governor of the Central Bank of Nigeria, Mr. Olayemi Cardoso, announced in Washington DC that the CBN is optimistic about attracting $1 billion in monthly remittances.
This confidence follows the resolution of concerns raised by International Money Transfer Operators and positive feedback from Nigerians in the Diaspora.
Cardoso made this disclosure during a joint press conference with the Minister of Finance and Coordinating Minister of the Economy, Mr. Olawale Edun, following the International Monetary Fund and World Bank Annual Meetings, according to ThisDay.
The CBN governor highlighted that Nigeria’s remittances rose from just over $250 million in April to over $600 million by September. He emphasized the central bank’s efforts to remove Nigeria from the grey list.
Additionally, Minister Edun stated that the bold reforms implemented by President Bola Tinubu’s administration are beginning to yield positive results.
“Nigeria has such a strong diaspora community here; in the earlier stages of the reforms, IMTOs were having issues transferring money back to Nigeria, and we felt it was important to engage them, and we did. As a result of that engagement, we identified particular problems, of which a lot of responsibility was shared. Things have since improved because as at the last meetings, which was, I think, April, monthly inflows were about $250 million, but as of September, it had risen to $600 million.
“With the recent announcement by Nigeria Interbank Settlement Systems (NIBBS) on Bank Verification Number (BVN), and other products that the banking industry is offering, and through engagement with the diaspora, we believe we will be able to move accordingly and again, rising from that engagement, we put our sights on increasing the inflows to $1 billion monthly and I’m confident that we will get there,” he explained.
To enhance investors’ confidence in the Nigerian economy, the CBN governor stated that the central bank is committed to removing Nigeria from the grey list, which includes countries with deficiencies in addressing illicit financial flows.
Being on this list subjects countries to increased scrutiny by the Financial Action Task Force, which focuses on strengthening anti-money laundering and combating the financing of terrorism efforts globally.
Giving a breakdown of his achievements in the last one year, the CBN governor said, “In the last one year, our focus has been on the exchange rate, enhancing financial systems provision, fostering financial inclusion, and enhancing transparency in our monetary policy decisions and communications.
“We embarked upon bold and necessary reforms to return to the path of monetary policy orthodoxy, as well as remove observed distortions in the foreign exchange market. Our efforts have yielded significant progress as volatility in the foreign exchange market has abated measurably and remittances have also increased significantly; we have achieved increased transparency and improved overall supply in the foreign exchange market, leading to reduced arbitrage and speculative activities and eliminated the front loading of foreign exchange demand.”
The CBN governor noted that the recapitalization policy has encouraged deposit money banks to strengthen their financial positions, aiming for a more robust banking sector. He expressed optimism that this initiative will contribute to realizing a $1 trillion economy by 2030. He emphasized the commitment to addressing ongoing challenges and highlighted the importance of a transparent market system.
Additionally, he stressed the need for greater financial and economic inclusion, particularly for small businesses, households, women, and youth, by utilizing innovative technologies and remote banking solutions.
“We aim to reduce transaction costs and expand financial access, ensuring that every Nigerian, regardless of location or demographic, can meaningfully participate in our evolving financial system regarding our commitment to orthodox monetary policy. Let me reiterate our determination to follow this path through a sequenced approach to tackling all challenges ahead. We recognise the continued support of our key stakeholders, including investors, banks, Nigeria diaspora, and businesses with our counterparts on the fiscal side, we have strengthened collaboration over the past year by establishing several joint committees. These committees are designed to drive actionable outcomes, creating impactful platforms for stakeholder engagement and delivering concrete solutions to align monetary policy with fiscal operations more effectively. I’m confident that with our collective efforts and sustained commitment, we can pave the way for a more prosperous Nigeria that fosters robust and inclusive growth,” he said.
Also speaking, the Minister of Finance and Coordinating Minister of the Economy, Edun said the bold reforms embarked upon by President Tinubu were yielding the necessary results.
“It has been a very interesting week of conversation at the highest level about the world economy, the status, direction, and various inputs as to the policy restrictions. We all agree that there is a need to combat inflation, for most of Europe, they are close to their target level of two per cent. Their economy is gradually recovering, and as a result, is gradually easing their monetary positions, which were very tight.
“In the advanced economies with inflation trending down, interest rates are also coming down and that is good news to those that have to go to the market to borrow money. For us in emerging markets and developing economies, there is still relatively high inflation and the majority view at this time is that interest rates have to remain high.
“At the same time, debt levels are clearly escalated and care has to be taken there and in addition, growth is low. So, we try to make sure that inflation is low, which needs to be combated as a priority because of the negative effect it has on purchasing power. But critical investments have to go on to ensure growth because, at the end of the day, it is growth, job-creating growth that will lead to poverty reduction,” he said.