Economy
CBN Tackles IMF on Forex Restriction Policy Over FDI Inflow
By Adedapo Adesanya
Governor of the Central Bank of Nigeria, Mr Godwin Emefiele, has opposed the observation put forth by the International Monetary Fund (IMF) that restrictions placed by the federal government on foreign exchange on some items was impeding the flow of Foreign Direct Investments (FDIs) into Nigeria.
The CBN chief made his stance known on Sunday while briefing journalists on the sidelines at the 2019 IMF and World Bank Annual Meetings in Washington DC., the United States.
He said that the IMF stance on FDIs being affected by goods that could be produced locally as a result of forex was false, pointing out that, “If you are a foreign direct investor that is interested in doing business in Nigeria, I will say instead of you facilitating the import of these items into Nigeria, we want you to come and produce it in Nigeria.”
Making his disagreement with the global lender clearer, Mr Emefiele said that the Nigerian market was large enough to accommodate investment that will bring about returns, noting that, “Nigeria is a market of over 200 million people. So, bring your investment plans and equipment, come and produce those items in Nigeria, you will make your profit and take your dividend out of the country. So, I disagree with the IMF position.”
The restrictions placed on 43 items by the federal government received criticism by the IMF last week when the agency’s Divisional Chief, Research Department, Oya Celasun, told a news conference on the World Economic Outlook at the meetings that the policy was holding back FDIs into the Nigerian local economy.
He said the decision to restrict forex access and shut the official foreign exchange window for the importation of the banned 43 items would protect Nigeria’s foreign reserves, as well as the nation’s economy.
According to him, the policy was introduced to stimulate the domestic economy and enhance domestic production and protect local industries from undue foreign competition and take-over.
But Celasun said the policy was working to the contrary, pointing out that Nigeria’s growth has been weak, even as he gave hope that growth would pick up next year with support from the agricultural sector, which will enable the country to spend more on priorities, such as social safety and infrastructure.
“There is need for the strengthening of the banking system and unified exchange rate system. Foreign exchange restrictions have also been distorting the public and private sector decisions and holding back investment.
“Therefore, strengthening the banking sector resilience and continued stronger structural reforms, especially in infrastructure, power sector and broader governance, are critical.” He said.
However, this was met with opposition by the apex bank chief who said the policy was put together to serve Nigeria’s best interest.
By Adedapo Adesanya
Three stocks weakened the NASD Over-the-Counter (OTC) Securities Exchange by 1.09 per cent on Friday, August 29, with one of the bellwethers, Central Securities Clearing System (CSCS), leading the losers’ chart after it shed N5.00 to close at N45.00 per share compared with the previous day’s N50.00 per share.
Further, First Trust Mortgage Bank Plc dipped 3 Kobo to close at 60 Kobo per unit versus 63 Kobo per unit and Geo-Fluids Plc dropped 1 Kobo to settle at N4.94 share, in contrast to the preceding day’s N4.95 per share.
As a result, the market capitalisation of the trading platform went down by N23.82 billion to N2.165 trillion from N2.189 trillion and the NASD Unlisted Security Index (NSI) declined by 39.81 points to finish at 3,619.89 points, in contrast to the 3,659.70 points it ended a day earlier.
During the trading session, there was a gainer and it was NASD Plc, which appreciated by N2.79 to close at N30.68 per unit compared with the previous day’s price of N27.89 per unit.
Yesterday, there was significant increase of 1,482.0 per cent in the volume of securities traded by the market participants to 8.5 million units from the previous session’s 535,298 units, there was a rise of 11.4 per cent in the value of securities to N10.4 million from N9.3 million, and there was an 8.8 per cent growth in the number of deals to 37 deals from 34 deals.
At the close of trades, Okitipupa Plc was the most traded stock by value on a year-to-date basis with 158.7 million units worth N5.9 billion, followed by Air Liquide Plc with 507.3 million units worth N4.2 billion, and FrieslandCampina Wamco Nigeria Plc with 44.4 million units transacted for N1.9 billion.
Also, Industrial and General Insurance (IGI) Plc was the most traded stock by volume on a year-to-date basis with 1.2 billion units sold for N413.6 million, trailed by Impresit Bakolori Plc with 536.9 million units worth N524.8 million, and Air Liquide Plc with 507.3 million units traded for N4.2 billion.
By Adedapo Adesanya
The final trading session of August 2025 was good for the Naira as it recorded its best performance in months, gaining N4.16 or 0.27 per cent against the US Dollar in Nigerian Autonomous Foreign Exchange Market (NAFEM) segment of the forex market on on Friday, August 29 to sell for N1,531.45/$1 compared with the N1,535.61/$1 it was traded on Thursday.
Equally, the domestic currency appreciated against the Pound Sterling in the official market yesterday by N12.17 to close at N2,064.25/£1, in contrast to the preceding day’s N2,076.42/£1 and improved against the Euro by N5.33 to quote at N1,789.18/€1 versus the previous day’s N1,794.51/€1.
In the black market, the Nigerian Naira maintained stability against the greenback during the trading session at N1,545/$1.
Fresh injection of FX from the Central Bank of Nigeria (CBN) with the sale of $50 million to authorised dealer banks eased forex demand pressure.
Also supporting the market was the gross external reserves balance climbing to $41.267 billion on Friday, buoyed by additional inflow totalling $23.421 million. This is hinting at the reserves rising towards $45 billion in a best case scenario giving by analysts.
In the cryptocurrency market, it was mixed as traders carried out profit taking and some bought amid uncertainties with the overall market valuation down by 4 per cent to $3.77 trillion despite a 10 per cent surge in the overall trading activity which sits at $192.06 billion in volume over the same period.
Solana (SOL) went down by 2.0 per cent to $205.06, Bitcoin (BTC) fell by 1.8 per cent to $108,348.26, and Ripple (XRP) shrank by 1.5 per cent to $2.82, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) traded flat at $1.00 each..
But, Cardano (ADA) jumped by 0.7 per cent to $0.8347, Dogecoin (DOGE) appreciated by 0.5 per cent to $0.2163, Ethereum (ETH) increased by 0.1 per cent to $4,398.89, Litecoin (LTC) gained 0.1 per cent to close at $110.60, and Binance Coin (BNB) grew by 0.1 per cent to $860.41.
By Adedapo Adesanya
Crude oil was down Friday as traders looked toward weaker demand in the US, the world’s largest oil market, and a boost in supply from the Organisation of the Petroleum Exporting Countries and its allies (OPEC+).
Brent crude traded at $68.12 a barrel after losing 50 cents or 0.73 per cent, and the US West Texas Intermediate (WTI) crude closed at $64.01 after shedding 59 cents or 0.91 per cent.
Crude output has increased as the OPEC+ group has accelerated output hikes to regain market share, raising the supply outlook and weighing on global oil prices. The market was in part shifting its focus toward next week’s OPEC+ meeting.
The US summer driving season ends on Monday’s Labour Day holiday, signalling the end of the highest demand period in the US.
There were also worries about tariffs imposed by the administration of President Donald Trump on US imports from many trading partners, with the market beginning to wonder what effect the tariffs might have on the economic outlook next year.
Prices rose earlier in the week due to Ukrainian attacks on Russian oil export terminals, but reports of talks between Ukraine’s European allies about a possible ceasefire helped tamp down prices ‘
Also, US crude inventories for the week ending August 22 showed higher-than-expected draws, implying late-summer demand was still firm, particularly in industrial and freight-related sectors.
Investors are also watching for India’s response to pressure from the United States to stop buying Russian oil, after Trump doubled tariffs on imports from India to as much as 50 per cent on Wednesday. So far, India has defied the US and Russian oil exports to India are set to rise in September.
This has not changed even as India’s state and private refiners bought more US crude in August to take advantage of the lower freight costs and an open arbitrage window caused by the hiked tariff and falling freight cost for supertankers.
Major investment banks expect Brent and WTI prices to slide in the fourth quarter of 2025 and the first quarter of 2026 amid a growing market oversupply. Banks including Goldman Sachs, Morgan Stanley, and JPMorgan see Brent prices averaging $63.57 per barrel in the fourth quarter.
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