Nigeria’s external reserves have climbed to $42.35 billion, a development the Central Bank of Nigeria (CBN) Governor, Olayemi Cardoso, attributes to the clearing of foreign exchange backlogs and a series of transparency-driven reforms in the foreign exchange market.
Speaking at the inaugural CBN Governor Annual Lecture Series at the Lagos Business School, themed “Next Generation Leadership in Monetary Policy and Nation Building,” Cardoso explained that restoring trust and credibility in Nigeria’s monetary system was among his first priorities upon assuming office.
He recalled that although the FX backlog predated his tenure, he made the decision to settle all verifiable claims following a forensic audit conducted by Deloitte, which exposed irregularities in some forward contracts.
“When I took office, I made a promise — we would clear the verifiable backlog of monies owed by Nigeria to third parties,” Cardoso said. “To be honest, I had no idea how we were going to do it, but it was not negotiable. We needed to protect and maintain our integrity.”
Describing the action as a “huge sacrifice,” the CBN chief emphasized that credibility and trust were indispensable to attracting long-term investment.
“If we expect people to trust and invest in our economy, we must keep our promises,” he said. “That action contributed in no small way to the rise in our reserves. People invest when they see credibility and transparency.”
Transparency as a Pillar of Reform
Cardoso outlined a range of reforms designed to strengthen confidence in the apex bank. Among them are open, televised Q&A sessions following every Monetary Policy Committee (MPC) meeting, the regular publication of audited financial statements — reversing years of opacity — and the public disclosure of Nigeria’s net reserves position at the end of 2024.
“Many doubted we would publish the net reserves figure,” he remarked. “But we gave a date, we delivered, and that gave investors confidence in the CBN.”
He also highlighted the adoption of a B-matching electronic trading system in the FX market, which, according to him, ensures that exchange rates and transactions are visible to all participants, thereby eliminating preferential access.
“The market has become more transparent, eliminating the situation where some had privileged access to FX while others did not,” he explained.
A Level Playing Field for Businesses
Cardoso reiterated that his broader vision was to ensure Nigerian businesses could thrive without political or personal connections.
“By the time I leave the Central Bank, you won’t need to know anybody to get your business going,” he said. “Today, most Nigerians can already use their naira debit cards abroad — something unthinkable two years ago.”
He stressed that the CBN’s central mission remained economic stability, which he described as the foundation for sustainable investment and growth.
Renewed Investor Confidence
Reflecting on the economic turnaround since 2023, Cardoso contrasted the current optimism with the earlier period when “many Nigerians had lost hope” and were moving assets abroad.
He noted that international rating agencies, development institutions, and major global investors — including BlackRock — were once again showing confidence in Nigeria’s prospects.
“We see an incredible increase in interest,” he said. “Many who sat on the sidelines are now saying: this is the time to get in.”
Embracing Technology and Innovation
Cardoso also revealed that the CBN board had held a retreat focused on digitisation and artificial intelligence, with plans to develop a roadmap for adopting emerging technologies in collaboration with the Securities and Exchange Commission (SEC).
He hinted at ongoing work around digital currencies and other innovations aimed at modernising the country’s financial ecosystem.
A Bright Outlook
Concluding his remarks, Cardoso expressed confidence in Nigeria’s economic direction, crediting two years of policy consistency and disciplined execution.
“Two years of consistent messaging, consistent policies, and uncompromising execution have taken us to a good place,” he declared. “In one word, the future of Nigeria is bright.”
Earlier, the Dean of Lagos Business School, Professor Olayinka David-West, described the lecture series as a reflection of Cardoso’s commitment to transparency and accountability — values he had pledged to uphold during his Senate confirmation.
The event drew an impressive list of attendees, including CBN Deputy Governors and leading figures from the banking and financial sector such as Segun Alebiosu (FirstBank), Wole Adeniyi (Stanbic IBTC Bank), Yetunde Oni (Union Bank), Miriam Olusanya (GTBank), Lawal Bolaji (Ecobank Nigeria), and Temi Popoola, the Group CEO of the Nigerian Exchange Group.