CBN Pays Nearly $2 Billion Towards FX Backlog

In a bid to clear the backlog of dollars, Africa’s biggest economy, Nigeria, via the Central Bank of Nigeria (CBN), has paid $2 billion out of nearly $7 billion in outstanding foreign exchange forward liabilities that have matured.

The Central Bank of Nigeria, CBN, has promised to pay up the outstanding to boost confidence in the foreign exchange market, especially on the need to attract foreign investors into the economy of the nation.

However, the acting spokesperson, Hakama Sadi Ali, in a statement released on Sunday, states, “In the past three months, the CBN has also redeemed the outstanding forward liabilities amounting to almost $2 billion.”

“This underscores the Bank’s commitment to the resolution of pending obligations and a functional foreign exchange market.”

With oil being the main export from Nigeria and the source of more than 90% of its foreign exchange inflows, its decline in output has made the country’s foreign exchange problems worse. The foreign exchange shortage has so far continued to cripple the country’s naira currency.

Ali, however, points out that the CBN had recently paid foreign airlines a total of $61.64 million, the money for tickets sold in local naira currencies that the airlines are unable to take out of the country.

“These payments signify the CBN’s ongoing efforts to settle all remaining valid forward transactions, to alleviate the current pressure on the country’s exchange rate,” Ali said.

Meanwhile, the President of Nigeria has promised to boost the flow of foreign currencies into Nigeria by attracting foreign direct investment by increasing oil output, hence the need to reform the foreign exchange market.

About The Author

Mayowa Durosinmi

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M. Durosinmi is a West Africa Weekly investigative reporter covering Politics, Human Rights, Health, and Security in West Africa and the Sahel Region

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