The Governor of the Central Bank of Nigeria, Olayemi Cardoso, emphasized the need for stronger economic ties with the Middle East. He pointed out the importance of collaboration in areas such as infrastructure, tourism, and the development of the financial sector.
During the inaugural Conference on Emerging Markets Economies in Saudi Arabia, he engaged in discussions with Talal Al-Humond, the Assistant Governor for Monetary Affairs at the Saudi Central Bank, to explore potential avenues for enhanced cooperation between the two countries.
In a press statement issued by the Central Bank of Nigeria, Governor Olayemi Cardoso highlighted Saudi Arabia’s focus on economic diversification, large-scale transformation, and investment in tourism as a model for Nigeria to follow in its pursuit of economic growth.
He also reaffirmed the apex bank’s commitment to engaging with the Nigerian diaspora in the Middle East to enhance remittance flows and strengthen the country’s financial sector.
The statement further noted that Talal Al-Humond, the Assistant Governor for Monetary Affairs at the Saudi Central Bank, expressed Saudi Arabia’s willingness to collaborate on mutually beneficial economic goals.
During a panel discussion moderated by Jihad Azour, the IMF’s Director for the Middle East and Central Asia, Governor Olayemi Cardoso provided an update on Nigeria’s foreign exchange market reforms.
He highlighted significant progress in stabilizing the naira, noting that the gap between the official and parallel market rates, which once reached as much as 60%, has now narrowed to around 4–5%. This improvement, according to Cardoso, is a result of consistent policy measures and increased market confidence.
He also pointed out that the introduction of an electronic forex matching system and a foreign exchange code of ethics signed by all Nigerian banks has enhanced transparency in forex trading. As a result, Nigeria’s foreign reserves have surpassed $40 billion, reaching their highest level in nearly three years.
Governor Olayemi Cardoso acknowledged the significant economic challenges Nigeria has faced, including capital flow reversals, multiple exchange rate regimes, currency depreciation, high inflation, and a backlog of foreign exchange transactions, all of which contributed to a loss of confidence in the naira.
Since assuming office, he said his team focused on restoring market confidence by clearing the forex backlog and implementing stabilizing reforms. To combat inflation and improve macroeconomic stability, Cardoso noted that the Central Bank has adopted a tight monetary policy, raising interest rates by 850 basis points over the past year.
The Governor also highlighted the removal of fuel subsidies, a policy that had cost Nigeria an estimated 6% of its GDP annually. He emphasized that eliminating the subsidy, along with addressing exchange rate inefficiencies, has strengthened Nigeria’s fiscal outlook.
To strengthen financial sector stability, Governor Cardoso emphasized the Central Bank’s directive for banks to undergo recapitalization. This measure aims to ensure that banks are better equipped to handle economic shocks and enhance the sector’s overall resilience.
Cardoso emphasized that financial inclusion remains a top priority for the Central Bank of Nigeria, with the current inclusion rate standing at 74%. He stressed the need to further expand access, particularly through digital banking solutions, mobile money services, and gender-focused financial initiatives to enhance economic participation among underserved groups.
He also reaffirmed the CBN’s commitment to macroeconomic stability, highlighting the importance of maintaining consistent policies to sustain investor confidence. While Nigeria’s monetary policy tightening initially faced skepticism, he noted that many international financial experts now recognize the necessity of this approach given the country’s economic challenges.
