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The Central Bank of Nigeria (CBN) has released data showing that Nigeria received a total of $952 million in direct remittances from Nigerians abroad between January and June of this year.
According to the CBN’s International Payment report, these remittances represent a 21% decline compared to the $1.210 billion recorded in the same period last year.
A monthly breakdown of the data reveals that Nigeria received $79.2 million in remittances in January 2023. In February, the total remittances slightly increased to $83.8 million, and in March, total direct remittances amounted to $138.6 million.
In April, the country received $150 million as direct remittances, and the inflow further increased to $202.9 million in May. In June 2023, total direct remittances to the country stood at $297.5 million.
No immediate cause for alarm has been signaled, as Dr. Yemi Kale, Partner, Chief Economist, and Head of Research at KPMG Nigeria, suggests that the decline in remittances in the first half of the year may be attributed to various factors, including the general elections and the cash and forex dynamics of the CBN during the first quarter.
Kale emphasizes that it would be more prudent to assess the situation in the third and fourth quarters before drawing any conclusions.
Direct remittances enter the country through channels such as International Money Transfer Operators and banks. According to the recently suspended CBN Governor, Godwin Emefiele, there are four major sources of foreign exchange inflow into Nigeria, which include proceeds from oil exports, proceeds from non-oil exports, Diaspora remittances, and foreign direct/portfolio investments.
In an effort to boost forex supply through the non-oil sector, the CBN launched ‘The RT200 FX Programme’ last year, which aimed to increase Diaspora inflow and remittances from an average of $6 million per week in December 2020 to an average of over $100 million per week by January 2022.
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