Nigeria’s external reserves are experiencing recovery after recent years that the country has recorded a drop in its foreign earnings, Governor of the Central Bank of Nigeria (CBN), Godwin Emefiele, said on Saturday.
He said this during the 10th annual Bankers Committee Retreat in Lagos.
He said, “External reserves have recovered significantly from $23bn in October 2016 to over $43bn as of December 3, 2018.
“While the drop in our export earnings arising from our reliance on crude oil exposed the fragility of our domestic economy in 2016, it also reinforced the view within the CBN and the Bankers Committee on the need to revise our growth strategy as a nation.”
With crude oil as a major source of the country’s foreign exchange, he said the nation’s economy became sensitive to fluctuations in the price of crude oil.
“Significant declines in the price of crude oil not only reduced Nigeria’s export earnings, the nation was also subjected to higher inflation and lower growth, given our dependence on imported goods,” he said.
With the discovery of shale oil, along with policy measures being put in place by advanced countries such as the United States and China, towards reducing car emissions and supporting alternative sources of energy such as battery powered cars, he said it had become imperative to build up buffers that would insulate the nation’s economy from volatility in the crude oil market.
According to the CBN governor, this can only be achieved if the country develops and implements measures that improve productivity of companies operating in Nigeria; reduce its dependence on imported goods that can be produced in Nigeria; and increase its imports of non-oil goods and services.
While these measures might take time to yield fruit, he added that it remained the best course of action to take, knowing that it would act as a catalyst for sustainable growth and job creation.
