Market News
FX inflows rise on non-oil export push - PUNCH
BY Felix Oloyede
Nigerian products are gradually meeting global standards, evident in the Lilypond Export Command of the Nigerian Customs Service, which reported a 318 per cent rise in non-oil export value during the first quarter of 2025, boosting the country’s foreign exchange inflows, FELIX OLOYEDE writes
Nigeria’s efforts to wean itself from over-reliance on oil revenue appear to be gaining traction. The Nigerian Export Promotion Council recently reported that the country’s non-oil exports increased by 20.79 per cent in value, reaching $5.456bn in 2024, up from $4.5 bn the previous year.
The Executive Director of the Nigerian Export Promotion Council, Nonye Ayeni, noted that the significant growth reflects the resilience and diversification of the country’s export sector beyond crude oil, a shift aimed at reducing the country’s reliance on oil revenue.
According to her, the growth was largely propelled by the expansion of agricultural exports, including cocoa seeds, cocoa butter, sesame seeds, and cashew nuts, alongside a rise in the export of urea and manufactured goods.
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“This achievement can be attributed to the active diversification of the economy through the non-oil sector, with a focus on promoting agriculture, solid minerals, and manufacturing.
“It also reflects the positive impact of the Federal Government’s efforts to enhance trade through effective fiscal and financial policy implementation,” Ayeni emphasised.
Similarly, the Customs Area Controller of the Lilypond Export Command, Ajibola Odusanya, reported that the command facilitated the export of goods valued at $986m between January and March 2025, compared to $236m during the same period in 2024, indicating a 318 per cent increase.
Giving a breakdown of the figures, Odusanya mentioned, “The 11,459 containers processed within the first quarter of 2025 show an increase of 5,568 containers when compared to the 5,891 handled in Q1 2024. Agricultural produce accounted for the highest share, with a total value of $596m. This was followed by manufactured goods at $329m and solid minerals at $50m. Other categories made up $9.4m.”
To achieve this goal, the Central Bank of Nigeria, along with other stakeholders such as the NEPC, Customs, and the Small and Medium Enterprises Development Agency of Nigeria, has been making concerted efforts to support Nigerian businesses. These efforts focus on enhancing competitiveness through capacity building, investing in technology, and promoting collaboration among financial institutions, business leaders, regulators, and policymakers. They aim to identify and eliminate barriers to growth and increase the export of Nigerian products.
The central bank has been promoting the need for Nigerian products to meet international standards. This effort aims to build confidence in locally produced goods, which has led to an increase in export revenues and efforts to attract more foreign exchange to the domestic economy.
The CBN, under the leadership of Olayemi Cardoso, made efforts to ensure that more forex flows into the economy and that such inflows remain accessible to businesses.
One immediate way to attract more foreign exchange into the economy is by enhancing the global competitiveness of Nigerian export products — a low-hanging fruit among several broader strategies.
Additional measures include boosting diaspora remittances through innovative product development, issuing licenses to new International Money Transfer Operators, and implementing a market-driven forex model based on a willing buyer-willing seller approach.
To further support forex inflows, the Central Bank has also streamlined dollar inflow channels for forex dealers and ensured timely access to naira liquidity for IMTOs — all aimed at driving business growth and strengthening the broader economy.
Annual diaspora remittances to Nigeria, estimated at $23bn, are a dependable source of forex for the domestic economy. Additionally, the central bank is exploring various other sources and policies to ensure a steady inflow of dollars.
The CBN’s initiatives have supported continued growth in these inflows, aligning with the institution’s objective of doubling formal remittance receipts within a year.
Remittances in the Nigerian economy are expected to rise due to the CBN’s ongoing efforts to enhance public confidence in the forex market. Additionally, the CBN aims to strengthen a robust and inclusive banking system while promoting price stability, which is essential for sustained economic growth.
The Director of Trading at Verto, Charlie Bird, said the dollar liquidity dynamic was now more balanced, with foreign investors and airlines able to repatriate funds.
Speaking during Cordros Asset Management seminar titled “The Naira Playbook”, he said Nigeria was now the darling of foreign investors because of improved dollar liquidity in the economy due to positive CBN’s reforms.
For instance, the CBN under Cardoso recently announced the introduction of two new financial products designed to serve Nigerians living abroad and attract more diaspora remittances.
These and other measures, including the granting of licences to new IMTOs, enabling timely access to naira liquidity to them, and implementing a willing buyer-willing seller model
Quality export
The CBN and Bankers’ Committee are championing initiatives to improve the quality of Nigerian products for export to global markets.
According to the CBN, Nigerian manufacturers can only stand a chance in the global market if their products can compete favourably with their counterparts abroad.
The banking sector is expected to play a crucial role in supporting businesses in enhancing their competitiveness. Locally made goods and services need better branding to increase their visibility and appeal in global markets and businesses require support to prepare for global market competition.
Speaking during a recent Bankers’ Committee meeting in Lagos, Director, Consumer Protection and Financial Department, CBN, Dr Aisha Olatinwo, said that with the ongoing support from the apex bank and commercial banks, local businesses will improve their potential to thrive in the global markets, adding that that there were, however, several constraints militating against the growth of Nigerian-made goods.
Olatinwo, who was represented by the Deputy Director, Consumer Protection and Financial Department, CBN, Nelson Amuwa, hinted that the bank was working to address those constraints in quality, packaging, branding, and global market readiness that hinder the growth of locally made goods and services.
Also, the Executive Chairman of the Lagos State Internal Revenue Service, Ayodele Subair, acknowledged that the financial sector has a role to play in ensuring the continuous survival of businesses.
He said, “The Bankers’ Committee plays a vital role in facilitating financial inclusion and driving made-in-Nigeria products. By working together, stakeholders can unlock the full potential of Nigeria’s financial system and promote export diversification and support local businesses.”
According to Dr Bamidele Ayemibo in his keynote address, manufacturers need to adopt product quality, packaging and product branding.
He posited that those measures would ensure the competitiveness of Nigerian products in regional and global markets.
“From manufacturing to fashion, to technology, and the industry, our ability to compete depends on how well we can align to embrace productivity and deliver consistent, high-quality products that command respect in global markets.
“By deepening these partnerships, we can identify and dismantle barriers to growth, encourage innovation, and scale up the support structures that enable enterprises to thrive in competitive environments. The Nigerian banking sector remains a critical industrial foundation to build Nigerian products, opportunity-building initiatives, and investment technology. Banks are well-positioned to support businesses in enhancing their competitive opportunities,” he asserted.
However, the President of the Manufacturers Association of Nigeria, Otunba Francis Meshioye, lamented that the operating climate for the manufacturing subsector had been harsh.
According to the MAN president, manufacturers spent a whopping N1.3tn on the cost of funds in 2024 alone, noting that the soaring interest rate, which oscillates between 35-37 per cent, was a disincentive to business.
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He urged the CBN and the Bankers Committee to come up with long-term financing options for manufacturers at favourable terms that would drive and not strangulate business concerns.
“It is critical at this point for the CBN and the Bankers Committee to fund production at cheaper rates, and fund backwards integration, among others. That is only to cut down the excess amount expended on the cost of funds, which is adversely affecting production in the country.”
IMTO revised guidelines
The CBN recently released the revised guidelines for International Money Transfer Services in Nigeria. These guidelines mark a significant shift in how IMTOs conduct their operations, reflecting the CBN’s ongoing efforts to enhance transparency and efficiency in forex transactions and to bolster diaspora remittances into Nigeria.
The apex bank circular titled “New Measures to Enhance Local Currency Liquidity for Settlement of Diaspora Remittances” highlighted its commitment to improving the Nigerian forex market infrastructure by increasing the flow of remittances through formal channels.
It introduces measures aimed at providing licensed IMTOs with access to naira from the CBN, facilitating the disbursement of remittances to beneficiaries.
Analysts at Duale, Ovia & Alex-Adedipe, a specialised law firm, explained that the guidelines permitted IMTOs to conduct payout of foreign remittances through agents, who were designated as authorised dealer banks.
They require IMTOs to enter into formal contracts with ADBs, outlining the terms and conditions of their engagement. Additionally, IMTOs are required to notify the CBN of the appointment of each ADB.
Furthermore, IMTOs are to receive foreign remittances in a designated account maintained with ADBs.
They explained that the account must be separate from other accounts held by the IMTO. The guideline mandates ADBs and IMTOs to disburse proceeds of foreign remittances to beneficiaries in naira.
According to Duale, Ovia & Alex-Adedipe’s analysts, payments can be made either through a bank account with the ADB or in cash, provided the cash withdrawal does not exceed $200. If a beneficiary does not have an account with the IMTO’s ADB, the ADB will credit the beneficiary’s account with another bank. Notably, under the Guidelines, IMTOs are prohibited from purchasing foreign exchange from the domestic market to settle funds for their customers.
The major significance of the circular is the introduction of measures to enhance the access of IMTOS to Naira liquidity, thereby facilitating the timely settlement of diaspora remittances.
Diaspora remittances
As part of its efforts to boost diaspora remittances and support naira stability, the CBN recently announced the launch of two new financial products designed to serve Nigerians living abroad.
The Non-Resident Nigerian Ordinary Account and the Non-Resident Nigerian Investment Account were created to streamline remittances, encourage investments, and foster financial inclusion among Nigerians in the diaspora.
It said, “The Central Bank of Nigeria is pleased to inform the general public of the introduction of the Non-Resident Nigerian Ordinary Account and Non-Resident Nigerian Investment Account targeted at Nigerians in diaspora.”
The initiative aims to create a secure and efficient platform for managing funds and investing in Nigeria’s financial markets.
According to the President of the Association of Bureaux De Change Operators of Nigeria, Dr Aminu Gwadabe, diaspora remittances are a crucial source of forex for Nigeria, supplementing both foreign direct investment and portfolio investments.
He noted that CBN’s initiatives had supported continued growth in those inflows, aligning with the institution’s objective of doubling formal remittance receipts within a year.
In a report titled “Diaspora Remittances: The Power Behind Africa’s Sustainable Growth,” Mohamed Touhami el Ouazzani, the Regional Vice President of Africa at Western Union, emphasised that while remittances can be quantified by the movement of money, their true impact is reflected in the lives they change. He revealed that in 2023, $90bn flowed into Africa from its global diaspora, an amount comparable to the Gross Domestic Product of entire nations.
He said, “Families with a breadwinner working abroad depend on these funds to provide vital support for day-to-day needs. They also build the foundation for broader financial stability.
“Beyond their immediate impact, remittances are powerful drivers of economic change. They fuel infrastructure development, spur entrepreneurship, and promote financial inclusion – all essential for long-term economic development. Ghana’s National Financial Inclusion and Development Strategy is simplifying access to remittances, while countries like Kenya, Ethiopia and Nigeria are tapping into diaspora bonds to fund infrastructure and other national projects.”
