Nigeria Records $6.83bn Balance of Payments Surplus in 2024, Signaling Economic Revival

Nigeria’s economy is showing promising signs of recovery with a recorded balance of payments (BoP) surplus of $6.83 billion in 2024, according to the Central Bank of Nigeria (CBN). This achievement reflects significant improvements in foreign inflows, strengthened trade performance, and effective fiscal management. The surplus marks a sharp turnaround from previous deficits of $3.34 billion in 2023 and $3.32 billion in 2022, signaling growing investor confidence and the success of macroeconomic reforms.

The 2024 surplus was largely driven by a goods trade surplus of $13.17 billion, with oil and gas exports playing a crucial role. Gas exports soared by 48.3%, reaching $8.66 billion, while non-oil exports rose by 24.6%, totaling $7.46 billion. Additionally, Nigeria saw a reduction in both petroleum and non-oil imports, reflecting improved fiscal discipline. Remittance inflows also surged, rising 8.9% to $20.93 billion, with stronger engagement from the Nigerian diaspora contributing to a 43.5% increase in International Money Transfer Operator (IMTO) inflows.

Despite a 42.3% drop in foreign direct investment (FDI) to $1.08 billion, Nigeria’s financial account saw substantial improvements, including a net acquisition of financial assets amounting to $12.12 billion. The country’s external reserves rose by $6.0 billion to $40.19 billion by the end of 2024, further solidifying its external financial cushion. Moreover, significant progress in data accuracy and transparency was noted, with net errors and omissions falling dramatically by 79.5%.

The BoP surplus is a testament to the success of Nigeria’s economic reforms, such as the liberalization and unification of the foreign exchange market, disciplined monetary policy, and coordinated fiscal measures. The CBN Governor emphasized that the positive turnaround in Nigeria’s external finances demonstrates the effectiveness of the country’s policies and their commitment to maintaining macroeconomic stability. This development is seen as a critical step forward for Nigeria’s economy, benefiting both businesses and the general populace.

Source: the sun