In a major economic victory, Nigeria has achieved a remarkable Balance of Payments (BOP) surplus of $6.83 billion in 2024. This marks a sharp recovery from previous deficits of $3.34 billion in 2023 and $3.32 billion in 2022, signaling a new chapter for the country’s economic health.
The Central Bank of Nigeria (CBN) unveiled the news in a statement issued by its acting Director of Corporate Communications, Mrs. Sidi-Ali Hakama. The BOP surplus is a crucial indicator of a country’s financial stability, tracking all economic exchanges with the global market. This includes the flow of goods, services, income, and capital between a country and the rest of the world.
For Nigeria, this surplus reflects the positive outcomes of strategic macroeconomic reforms, improved trade performance, and a renewed wave of confidence from both investors and local businesses.
Highlights of Nigeria's Economic Recovery in 2024
Several key factors contributed to the impressive $6.83 billion surplus:
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Stronger Trade Performance: The current and capital account recorded a $17.22 billion surplus, largely driven by a $13.17 billion goods trade surplus.
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Drop in Imports: Petroleum imports dropped by 23.2% to $14.06 billion, while non-oil imports fell by 12.6% to $25.74 billion.
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Increased Exports: Nigeria's non-oil exports grew by 24.6% to $7.46 billion, while gas exports surged by 48.3%, reaching $8.66 billion.
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Robust Remittances: Personal remittances rose by 8.9%, totaling $20.93 billion, while international money transfer operator (IMTO) inflows saw a dramatic 43.5% increase to $4.73 billion, highlighting growing diaspora engagement.
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Rising Official Assistance and Financial Inflows: Official development assistance climbed by 6.2% to $3.37 billion, while portfolio investment inflows more than doubled, increasing by 106.5% to $13.35 billion.
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Increased Domestic Confidence: Nigeria's foreign currency holdings swelled by $5.41 billion, showcasing stronger confidence in the country's economic stability.
Despite a 42.3% dip in Foreign Direct Investment (FDI), which dropped to $1.08 billion, the overall financial account remained buoyant, pointing to a resilient economy.
By the end of 2024, Nigeria’s external reserves grew by $6 billion to reach a robust $40.19 billion. This increase in reserves helps bolster the country’s financial safety net, ensuring greater economic stability in the face of global uncertainties.
An especially significant achievement is the narrowing of net errors and omissions by 79.5%, from a massive $24.90 billion in 2023 to a more manageable negative $5.10 billion. This dramatic improvement reflects major strides in data accuracy and reporting transparency, further enhancing the credibility of Nigeria’s economic reporting.
The Impact of Strategic Economic Reforms
The success of this turnaround can be attributed to a series of well-coordinated economic reforms. The liberalization and unification of the foreign exchange market, along with disciplined monetary policies aimed at managing inflation and stabilizing the Naira, have enhanced Nigeria’s economic competitiveness. These measures have undoubtedly played a role in boosting investor sentiment and driving business growth.
CBN Governor, Mr. Olayemi Cardoso, praised the results as a testament to Nigeria’s commitment to macroeconomic stability and effective policy execution. "This surplus marks a significant milestone for Nigeria’s economy, offering tangible benefits to investors, businesses, and Nigerians alike," he stated.
Looking Ahead: A Positive Outlook for Nigeria's Economy
As Nigeria moves forward, the $6.83 billion BOP surplus signals a brighter economic future. With strategic reforms continuing to strengthen the financial landscape, the country is well-positioned to achieve sustained growth, making it an attractive destination for investors and boosting the prospects for everyday Nigerians.