The recent economic reforms implemented by President Bola Tinubu’s administration in Nigeria have begun to yield significant results, with foreign investor demand for Nigerian assets and remittances from citizens living abroad experiencing a surge last month, a Bloomberg report has revealed.
According to Hakama Sidi Ali, a spokeswoman for the central bank, foreign portfolio investor asset purchases exceeded $1 billion in February, bringing total receipts for the year to at least $2.3 billion. This marks a substantial increase compared to the $3.9 billion recorded for the entire year of 2023.
Additionally, overseas remittances rose more than fourfold to $1.3 billion in February from the previous month.
Ali attributed the inflows to increased investor interest in short-term sovereign debt, particularly following the recent adjustment to benchmark interest rates.
The central bank raised its key rate by 400 basis points to 22.75% last month.
Since assuming office in late May, President Tinubu’s government has implemented various reforms aimed at attracting investors back into the Nigerian economy and stabilizing the naira, which has experienced significant depreciation, losing more than 70% of its value since last year.
These reforms include relaxing foreign-exchange controls, easing rules on international money transfers, and narrowing the gap between the central bank’s policy rate and yields on short-dated paper sold at auctions.
Governor Olayemi Cardoso expressed optimism about the impact of these measures, stating, “All the different measures we have taken to boost reserves and create more liquidity in the markets have started to pay off.”
From Bloomberg
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