In a significant development for Nigeria’s economy, Central Bank of Nigeria (CBN) Governor Olayemi Cardoso has announced that the naira has become more competitive, reflecting its real value and attracting increased foreign investment. This statement underscores the positive impact of recent monetary and foreign exchange reforms implemented by the CBN.
Speaking at the 2025 Monetary Policy Forum in Abuja, Governor Cardoso highlighted that despite the naira’s volatility in recent years, the international community now believes the currency is reflective of its true rate and is more competitive. He emphasized that the CBN’s commitment to orthodox monetary policies and transparency has been pivotal in stabilizing the macro economy and positioning Nigeria favorably on the global stage.
Key reforms contributing to this newfound competitiveness include the unification of multiple exchange rates, the adoption of a market-determined exchange rate policy, and the implementation of an electronic FX matching platform. These measures have enhanced transparency, reduced arbitrage opportunities, and restored investor confidence.
Since early 2024, the CBN has introduced a string of reforms, including the dismantling of multiple exchange rates, lifting restrictions on forex access for legitimate business needs, and tightening interest rates to curb inflation. These measures initially led to a steep devaluation of the naira, but in recent months, the currency has shown signs of stabilization, hovering around ₦980 to $1 in official markets—a marked improvement from the ₦1,400 range seen in late 2023.
The impact of these reforms is evident in Nigeria’s improved economic indicators. The country’s foreign exchange reserves have risen to over $40 billion, the highest level recorded in nearly three years. Additionally, diaspora remittances have seen a significant increase, moving from N12.478 trillion in 2023 to N22.734 trillion by the end of the third quarter of 2024.
Analysts say the competitiveness Cardoso refers to lies in the naira’s ability to now attract inflows from diaspora remittances, foreign investors, and exporters, who previously shunned Nigeria due to opaque currency policies and instability.
“A competitive currency doesn’t just mean it’s weak or strong,” explained Bismarck Rewane, a Lagos-based economist. “It means it is fairly priced and predictable—two things investors crave.”
Governor Cardoso also noted that the CBN’s efforts have led to a narrowing exchange rate disparity and a more stable foreign exchange market. These developments have made Nigeria more attractive to foreign investors, with increased capital inflows and a surge in foreign portfolio investments.
While acknowledging the challenges faced during the reform process, Governor Cardoso expressed optimism about Nigeria’s economic trajectory. He reaffirmed the CBN’s commitment to maintaining transparency and implementing policies that foster a resilient and competitive economy.
As Nigeria continues to implement strategic economic reforms, the enhanced competitiveness of the naira serves as a testament to the country’s progress and potential for sustainable growth.
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