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The Central Bank of Nigeria (CBN) has announced a historic surge in remittance inflows, reporting a record-breaking $553 million in July 2024. This marks a remarkable 130% increase compared to the same period in 2023, setting a new high for monthly remittance totals.
Sidi Ali, the Acting Director of Corporate Communications at the CBN, attributed this significant increase to the bank’s strategic initiatives aimed at enhancing liquidity in Nigeria’s foreign exchange market. “The CBN has recorded an impressive $553 million in remittance inflows for July 2024, representing a 130% growth from the same period last year. This is the highest monthly inflow on record and reflects the success of our ongoing efforts to boost liquidity in the foreign exchange market,” Ali stated.
The CBN explained that this surge in remittance inflows is largely due to targeted policy measures designed to encourage the flow of foreign currency into the country. Key among these initiatives were the issuance of licenses to new International Money Transfer Operators (IMTOs), the implementation of a willing buyer-willing seller model, and efforts to ensure prompt naira liquidity for these operators.
Diaspora remittances have long been a vital source of foreign exchange for Nigeria, complementing other critical financial inflows such as foreign direct investment and portfolio investments. The CBN underscored the increasing importance of these remittances in sustaining the nation’s economy. “Diaspora remittances are an essential source of foreign exchange for Nigeria, supplementing foreign direct investment and portfolio investments,” the CBN noted.
The Central Bank’s policies aimed at doubling formal remittance receipts within a year are clearly paying off, as evidenced by this dramatic rise in inflows. This trend is seen as a clear indication of the effectiveness of the CBN’s efforts to build public confidence in the foreign exchange market, strengthen a resilient and inclusive banking system, and maintain price stability—key elements necessary for sustained economic growth.
In addition to the rise in remittance inflows, the National Bureau of Statistics recently reported a slowdown in Nigeria’s year-on-year headline inflation rate for the first time in 19 months. The CBN attributed this improvement to its stringent monetary policy tightening measures, which appear to be delivering the desired outcomes.
“The surge in remittances is a strong testament to the success of the CBN’s ongoing efforts to boost public confidence in the foreign exchange market, reinforce a robust and inclusive banking system, and promote price stability, all of which are crucial for sustained economic growth,” the CBN added.
The Central Bank also expressed optimism that the current upward trend in remittance inflows will significantly contribute to achieving broader economic objectives, particularly in maintaining stability within the foreign exchange market. The CBN assured that it will continue to monitor market conditions and adjust policies as necessary to facilitate even greater remittance flows into Nigeria.
Furthermore, the CBN acknowledged the recent decline in the country’s inflation rate as a positive signal that its monetary measures are beginning to take effect. This reduction in inflation is seen as further evidence of the effectiveness of the CBN’s strategies in stabilizing the economy and managing inflationary pressures.
As the CBN continues to implement and refine its policies, the outlook for Nigeria’s economic stability appears promising, with increasing remittance inflows playing a pivotal role in bolstering the nation’s foreign exchange reserves and supporting broader economic growth.
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