Economy

Nigeria Likely to Adopt Single Exchange Rate 2020—Fitch

Published

7 years ago

13/04/2019

By Dipo Olowookere

The multiple exchange rate system operated by the Central Bank of Nigeria (CBN) has been talked about and kicked against by several financial experts and economists in and outside the country. They have always argued that the system was absurd.

In the wake of this present administration, former CBN Governor and now Emir of Kano, Mr Sanusi Lamido, said the system was making few individuals millionaires and billionaires at the expense of the nation.

This is because the central bank has a rate of N305 per Dollar that is far lesser than the rates at the black market as well as the investors and exporters forex window of N363 to a Dollar.

The traditional ruler had argued that with the present system, it was easy for few powerful Nigerians to obtain forex at the interbank rate and make a profit of over N50 per Dollar selling to black market traders.

But the CBN has always argued that it would gradually unify the different rates at the forex market segments.

Business Post reports that the major market windows in the country are the Interbank, Investors & Exporters, Bureau De Change (BDC) and the black market.

Recently, renowned rating agency, Fitch, released a report, where it said the country’s apex bank will likely not carry out any forex reform this year but in 2020.

Before the February 2019 presidential, which was won by the incumbent President Muhammadu Buhari, his opponent at the poll, Mr Atiku Abubaker, had promised a unification of the rates to allow a more free-market.

With the election over, Fitch said in the short-term, “We believe that there will be little change to Nigeria’s current exchange rate regime in the immediate aftermath of the February 2019 general election.

“The official interbank rate currently sits at N305.87/$, while the ‘investor and export’ window (also known as the Nigerian Autonomous Foreign Exchange Rate, NAFEX) is trading at N362.68/$.

“The official interbank rate is officially pegged to the US dollar at the current level and used primarily as a reference rate for transactions by the state-owned Nigerian National Petroleum Corporation (NNPC).

“The NAFEX rate – at which investors, importers and non-state oil exporters buy and sell FX – is ostensibly free-floating but is also in effect managed.

“We believe that the authorities will remain determined – and able – to hold rates around their existing levels in the months ahead,” Fitch said in the report obtained by Business Post.

In terms of ability, Nigeria’s total gross reserves stood at $43.1 billion in late January – some 6.2 percent above levels seen at this point last year.

Import cover stands at more than 8 months, which although down from the October 2017 level of more than nine months is well above Nigeria’s recent low of 4.8 months in 2014.

“This level of reserves will give the authorities the resources to keep the market supplied in the context of slowing dollar inflows,” the agency stated.

Fitch said it has the strong believe that in the long-term, “We expect a shift away from the multi-tiered exchange rate and a consolidation of exchange rates, initially around the prevailing NAFEX level.

“However, this is unlikely to take place in 2019, and we thus expect the interbank rate – the rate that we forecast – to end the year at N306/$.

“Rather, we believe it is far more likely to take place in 2020, alongside the projected completion of the 650,000bbl/day Dangote oil refinery,” it said.

According to the National Bureau of Statistics (NBS), Nigeria’s downstream oil and gas sector imported petrol worth N1.02 trillion in the third quarter of 2018 alone. The coming online of the refinery will go some of the way towards easing the size of the import bill and making the effective devaluation of the interbank rate (which is used primarily for fuel imports) less painful.

“We thus expect the new Naira rate to end the year at some N370$.

“Following the unification, we believe that a gradual depreciation of the new Naira rate is likely. The authorities are likely to continue heavily managing its exchange rate regime.

“However, deteriorating fundamentals will put downward pressure on the currency. This underpins our forecast that the Naira will end 2020 at N370/$, and will continue to depreciate steadily thereafter.

“We expect the price of Brent crude to average $75.0/bbl in 2019 and $82.0/bbl in 2020, and while this is an improvement on the $71.7/bbl in 2018, oil prices will remain well below their 2011-14 highs, and risks are weighted to the downside,” Fitch said.

“Our Oil & Gas team currently see limited growth in the sector beyond 2019 given a very restricted pipeline of projects, although there is an upside risk that genuine reform of the industry will spur a resurgence in much needed investment.

“In the context of only muted growth in oil revenues, we expect the Central Bank of Nigeria (CBN) to allow the unified rate to devalue slowly in a bid to ease the pressure on reserves,” it concluded.

Economy

NGX RegCo Revokes Trading Licence of Monument Securities

Published

6 hours ago

14/01/2026

Aduragbemi Omiyale

By Aduragbemi Omiyale

The trading licence of Monument Securities and Finance Limited has been revoked by the regulatory arm of the Nigerian Exchange (NGX) Group Plc.

Known as NGX Regulations Limited (NGX Regco), the regulator said it took back the operating licence of the organisation after it shut down its operations.

The revocation of the licence was approved by Regulation and New Business Committee (RNBC) at its meeting held on September 24, 2025, a notice from the signed by the Head of Market Regulations at the agency, Chinedu Akamaka, said.

“This is to formally notify all trading license holders that the board of NGX Regulation Limited (NGX RegCo) has approved the decision of the Regulation and New Business Committee (RNBC)” in respect of Monument Securities and Finance Limited, a part of the disclosure stated.

Monument Securities and Finance Limited was earlier licensed to assist clients with the trading of stocks in the Nigerian capital market.

However, with the latest development, the firm is no longer authorised to perform this function.

Economy

NEITI Advocates Fiscal Discipline, Transparency as FG, States, LGs Get N6trn in Three Months

Published

6 hours ago

14/01/2026

Adedapo Adesanya

By Adedapo Adesanya

The Nigeria Extractive Industries Transparency Initiative (NEITI) has called for fiscal discipline and transparency as data showed that federal government, states, and local governments shared a whopping N6 trillion Federation Account Allocation Committee (FAAC) disbursements in the third quarter of last year.

In its analysis of the FAAC Q3 2025 allocation, the body revealed that the federal government received N2.19 trillion, states received N1.97 trillion, and local governments received N1.45 trillion.

According to a statement by the Director of Communication and Stakeholders Management at NEITI, Mrs Obiageli Onuorah, the allocation indicated a historic rise in federation account receipts and distributions, explaining that year-on-year quarterly FAAC allocations in 2025 grew by 55.6 per cent compared with Q3 of 2024 while it more than doubling allocations over two years.

The report contained in the agency’s Quarterly Review noted that the N6 trillion included 13 per cent payments to derivative states. It also showed that statutory revenues accounted for 62 per cent of shared receipts, while Value Added Tax (VAT) was 34 per cent, and Electronic Money Transfer Levy (EMTL) and augmentation from non-oil excess revenue each accounted for 2 per cent, respectively.

The distribution to the 36 states comprised revenues from statutory sources, VAT, EMTL, and ecological funds. States also received additional N100 billion as augmentation from the non-oil excess revenue account.

The Executive Secretary of NEITI, Mr Sarkin Adar, called on the Office of the Accountant General of the Federation, the Revenue Mobilisation Allocation and Fiscal Commission (RMAFC) FAAC, the National Economic Council (NEC), the National Assembly, and state governments to act on the recommendations to strengthen transparency, accountability, and long-term fiscal sustainability.

“Though the Quarter 3 2025 FAAC results are encouraging, NEITI reiterates that the data presents an opportunity to the government to institutionalise prudent fiscal practices that will protect the gains that have been recorded so far in growing revenue and reduce vulnerability to commodity shocks.

“The Q3 2025 FAAC results are encouraging, but windfalls must be managed with discipline. Greater transparency, realistic budgeting, and stronger stabilisation mechanisms will ensure these resources deliver durable benefits for all Nigerians,” Mr Adar said.

NEITI urged the government at all levels to ensure the growth of Nigeria’s sovereign wealth and stabilisation capacity, by committing to regular transfers to the Nigeria Sovereign Wealth Fund and other related stabilisation mechanisms in line with the fiscal responsibility frameworks.

It further advised governments at all levels to adopt realistic budget benchmarks by setting more conservative and achievable crude oil production and price assumptions in the budget to reduce implementation gaps, deficit, and debt metrics.

This, it said, is in addition to accelerating revenue diversification by prioritising reforms that would attract investments into the mining sector, expedite legislation to modernise the Mineral and Mining Act, support reforms in the downstream petroleum sector, as well as the full implementation of the Petroleum Industry Act (PIA) to expand domestic refining and value addition.

Economy

World Bank Upwardly Reviews Nigeria’s 2026 Growth Forecast to 4.4%

Published

6 hours ago

14/01/2026

Aduragbemi Omiyale

By Aduragbemi Omiyale

Nigeria has been projected to record an economic growth rate of 4.4 per cent in 2026 by the World Bank Group, higher than the 3.7 per cent earlier predicted in June 2025.

In its 2026 Global Economic Prospects report released on Tuesday, the global lender also said the growth for next year for Nigeria is 4.4 per cent rather than the 3.8 per cent earlier projected.

As for the sub-Saharan African region, the economy is forecast to move up to 4.3 per cent this year and 4.5 per cent next year.

It stressed that growth in developing economies should slow to 4 per cent from 4.2 per cent in 2025 before rising to 4.1 per cent in 2027 as trade tensions ease, commodity prices stabilise, financial conditions improve, and investment flows strengthen.

In the report, it also noted that growth is expected to jump in low-income countries by 5.6 per cent due to stronger domestic demand, recovering exports, and moderating inflation.

As for the world economy, the bank said it is now 2.6 per cent and not 2.4 per cent due to growing resilience despite persistent trade tensions and policy uncertainty.

“The resilience reflects better-than-expected growth — especially in the United States, which accounts for about two-thirds of the upward revision to the forecast in 2026,” a part of the report stated.

“But economic dynamism and resilience cannot diverge for long without fracturing public finance and credit markets,” it noted.

World Bank also said, “Over the coming years, the world economy is set to grow slower than it did in the troubled 1990s — while carrying record levels of public and private debt.

“To avert stagnation and joblessness, governments in emerging and advanced economies must aggressively liberalise private investment and trade, rein in public consumption, and invest in new technologies and education.”