The swap deal, originally signed in April 2018 between the Central Bank of Nigeria (CBN) and the People’s Bank of China (PBoC), was renewed in December 2024 for about $2 billion. The arrangement allows businesses in both countries to settle trade directly in naira and yuan, bypassing the dollar. Given China’s position as Nigeria’s largest trading partner — with imports valued at N14.14 trillion and exports topping N3 trillion in 2024 — the deal has given Nigerian importers a new channel to ease foreign exchange bottlenecks.
Forex operators say the impact is already visible. Aminu Gwadebe, President of the Association of Bureau De Change Operators of Nigeria (ABCON), explained that P2P platforms are amplifying the effect of the swap deal. “The Chinese are now collecting naira for yuan, and this is happening through P2P transactions,” he told Nairametrics. “This reduces the need for dollars, easing pressure on the naira.” He added, however, that while the intervention has helped in recent months, doubts remain over its long-term sustainability.
P2P platforms — which allow direct currency exchange between individuals outside the traditional banking system — are gaining popularity for their efficiency and lower costs. Traders say the ability to swap naira for yuan without routing through dollars is making transactions smoother, particularly for Nigerians doing business in Chinese markets where naira is increasingly accepted.
Yet not all market players are convinced of a structural shift. Yusuf, a Lagos-based trader, cautioned that dollar dominance remains intact. “The swap is helpful, but its effect on the black market is minimal. The dollar remains king for most traders,” he said, noting the scarcity of yuan in Nigeria’s informal markets and the continued global preference for the U.S. currency in international transactions.
Economists argue that while the currency swap helps diversify Nigeria’s forex sources, it is not a silver bullet for the country’s chronic dollar shortages. With Chinese imports accounting for only about 20 percent of Nigeria’s annual trade, the dollar continues to underpin most of the country’s external transactions — from education and healthcare payments abroad to remittances.
Still, the combined effect of the swap deal and P2P platforms is being seen as an important step toward reducing Nigeria’s vulnerability to dollar volatility. Policymakers view the arrangement as part of a broader strategy to strengthen economic resilience, boost foreign reserves, and provide breathing space for the naira.
For now, the mood is cautiously optimistic: the naira is steadier, traders are adapting to yuan-based alternatives, and Nigeria’s forex market is showing signs of greater flexibility. Whether this stability proves durable will depend on how effectively the initiatives are scaled and whether businesses fully embrace direct naira-yuan transactions in the months ahead.