Some financial experts have commended the Federal Government for raising Nigeria’s external reserves to $41 billion, the highest in nearly four years.
They also emphasised the need to channel more efforts toward alleviating the economic hardship faced by citizens.
The experts, who gave the commendation in separate interviews in Lagos yesterday, described the development as a positive signal for investor confidence, but warned that more substantial reserves would mean little if inflation and poverty remained unchecked.
Professor Sherifdeen Tella of the Department of Economics at Babcock University, Ogun State, stated that the increase in foreign reserves reflected a stronger outlook for Nigeria’s economy.
“The country boosting its reserves means greater import cover and more confidence from both Foreign Direct Investors (FDIs) and portfolio investors,” Tella said.
He, however, urged the government not to be carried away by the numbers, stressing that food inflation, driven mainly by agricultural challenges, continued to weigh heavily on ordinary Nigerians.
Similarly, Chris Nemedia, a former Director at the Central Bank of Nigeria (CBN), stated that building reserves is vital for protecting the local currency and strengthening Nigeria’s position with international development partners.
“It is important because reserves serve as a buffer to reduce the need for excessive foreign borrowing,” Nemedia said.
“However, beyond this, the government must put in more effort in reducing inflation, which is steadily eroding the purchasing power of citizens.”
Also commenting, Boniface Okezie, President of the Progressive Shareholders Association of Nigeria, said the robust reserves could help restore investor confidence.
According to him, the increased reserves will assure foreign investors of easy fund repatriation and enable the government to meet its obligations to international creditors.
“We cannot be celebrating rising reserves when the impact is yet to be felt by the people. A large number of Nigerians are still in abject poverty due to the cost-of-living crisis. Government must focus on welfare and improving livelihoods,” Okezie said.
Nigeria’s foreign exchange reserves rose to $41 billion on August 19, the highest level since December 3, 2021.
Figures from the CBN show that the country has enjoyed steady external accretion in recent weeks, mainly due to improved oil receipts and tighter monetary policies aimed at stabilising the Naira.
Nigeria’s reserves, which had dropped below $34 billion in 2023 amid foreign exchange shortages and heavy debt servicing, have now rebounded.
This offers the government a more substantial buffer for imports, debt repayment, and currency stability.
