How Much Is Nigeria’s External Reserve?

 By Marcel Okeke

The deafening silence of the Central Bank of Nigeria (CBN) since JP Morgan’s very shocking revelation a few weeks ago that Nigeria’s foreign exchange (FX) reserves stood at about US$3 billion as at end-December 2022 is really worrisome. 

According to the American financial services firm, a combination of foreign exchange forwards, securities lending, currency swaps, and outstanding contracts has weakened Nigeria’s net external reserves to an all-time low of US$3.7 billion as of the end of last year. Although data from the CBN had shown that Nigeria’s external reserves stood at US$33.88 billion as of August 10, 2023, down from US$37.08 billion at the end of last year, JP Morgan says the country’s “net forex reserves are significantly lower than previously estimated.”

Floating Naira: Death Knell For Nigerian Economy

 By Marcel Okeke 

A shocking headline in an online publication: “Naira slumps to N700/dollar as CBN floats currency, stops fixing exchange rates,” stirred my worry and alarm to pen this piece. According to the news story “the Central Bank of Nigeria (CBN) has reportedly directed Deposit Money Banks (DMBs) to remove the rate cap on the naira at the Investor and Exporters’ (I & E) window of the foreign exchange market, to allow for a free float of the national currency against the dollar and other global currencies.” This floating of the national currency is coming barely two weeks after President Bola Ahmed Tinubu’s ‘promise’ in his inaugural address that he was going to unify the nation’s multiple exchange rates.

According to Investopedia, a floating exchange rate is a regime where the currency price of a nation is set by the forex market based on supply and demand relative to other currencies. This is in contrast to a fixed exchange rate, in which the government (that is CBN, in Nigeria) entirely or predominantly determines the rate.

The World Ahead 2023: Whither Nigeria?

 By Marcel Okeke

The World Ahead 2023” is the 2022 end-of-year special publication of The Economist (of London) in which the journal reviewed the global economy in the outgoing year and made detailed projections about 2023, including what issues are most likely to dictate the trends in the coming year. It says: “After two years when the (COVID-19) pandemic shaped the immediate future, it is now the Ukraine war.”

The journal gave four things to think about for 2023, namely: (1) the impact of the conflict; (2) the struggle to control inflation; (3) chaos in energy markets; and (4) China’s uncertain post-pandemic path. Going granular in its analysis, the publication gave ten themes and trends for 2023—thus: all eyes are on Ukraine; recessions loom; climate silver lining; peak China; divided America; flashpoints to watch (India-China, Turkey-Greece); shifting alliances; revenge tourism; metaverse reality check; and New year, new jargon.

New Presidential Economic Team: What Agenda?

 By Marcel Okeke

Recently, to the chagrin and perhaps, bewilderment of most Nigerians, the President Muhammadu Buhari-led Federal Government inaugurated a ‘Presidential Committee on the National Economy’—just about 35 weeks to the end of the eight-year (two terms) tenure of the Administration. Truly, not a few Nigerians were stupefied by this ‘eleventh hour’ or ‘injury time’ move of the Government at the Centre—justifiably for numerous reasons. 

More surprisingly, for the first time in the over seven-year-long life of the Administration, Mr. President himself assumed headship of the economic team—and presided over its inaugural meeting on Friday, September 9, 2022. About the same time, the National Economic Council (NEC), putatively headed by the Vice President, was reportedly ‘rushing out’ a National Social Protection Policy (NSPP)—to be ratified and approved ‘soon’ by the Federal Executive Council.

*Buhari and Finance Minister Zainab Ahmed

At the inauguration of the new Presidential Economic Team, President Buhari said: “this Committee will provide our nation an opportunity to be bold, more proactive, and innovative in tackling persistent challenges”, adding that “the work with which I have tasked the assembled team will enable us respond more swiftly and efficiently.”