Nigeria’s net foreign exchange reserves rose significantly to $23.11bn at the end of 2024, marking the highest level in over three years, according to the Central Bank of Nigeria.
In a press statement on Tuesday, the apex bank noted that this represents a significant jump from $3.99bn recorded at the end of 2023, $8.19bn in 2022, and $14.59bn in 2021.
The statement read, “NFER stood at $23.11bn, the highest level in over three years, a marked increase from $3.99bn at year-end 2023, $8.19bn in 2022, and $14.59bn in 2021.”
The NFER, which adjusts gross reserves to account for near-term liabilities such as FX swaps and forward contracts, is regarded as a more accurate measure of the country’s foreign exchange buffers available to meet immediate external obligations.
The CBN also reported that Nigeria’s gross external reserves increased to $40.19bn as of December 2024, compared to $33.22bn at the end of 2023.
This improvement reflects deliberate measures taken by the CBN to reduce short-term foreign exchange liabilities, particularly FX swaps and forward obligations.
According to the statement, CBN Governor Olayemi Cardoso attributed the increase to strategic policy decisions aimed at enhancing investor confidence, reducing vulnerabilities, and building a more robust reserve position.
“This improvement in our net reserves is not accidental; it is the outcome of deliberate policy choices aimed at rebuilding confidence, reducing vulnerabilities, and laying the foundation for long-term stability,” Cardoso said.
The CBN noted that the improvement in NFER was driven by a combination of factors, including a significant reduction in short-term FX liabilities such as swaps and forwards, which previously posed risks to liquidity.
Also, increased foreign exchange inflows from non-oil sources contributed to strengthening the reserve position.
The bank also credited policy reforms aimed at restoring confidence in the FX market, which helped attract more sustainable inflows.
The CBN expressed optimism about sustaining this upward trend in 2025.
While the first quarter showed some seasonal adjustments, including significant interest payments on foreign-denominated debt, the underlying fundamentals remained strong.
Reserves are expected to continue growing, driven by improved oil production levels and a favourable export environment, particularly from non-oil sectors.
The CBN said these factors would enhance Nigeria’s external liquidity and support a stable exchange rate.
Cardoso reiterated the apex bank’s commitment to prudent reserve management, transparent reporting, and macroeconomic policies aimed at maintaining stability, attracting investment, and building long-term economic resilience.
