Nigeria’s external reserves hit a two-year low, reaching $33.9 billion on July 19, 2023, according to data from the Central Bank of Nigeria (CBN). The decline has been observed since President Bola Tinubu assumed office, representing a 3.32% drop since he succeeded former President Muhammadu Buhari.
Tinubu’s foreign exchange reform aimed at strengthening the naira against the dollar has led to devaluation of the naira and unification of multiple foreign exchange rates, merging all official rates into the Investors’ and Exporters’ window.
Despite the World Bank and International Monetary Fund (IMF) advocating for such reforms to boost Nigeria’s economy, the short-term impact has been contrary to the intended objective, resulting in a $1.16 billion decrease in foreign reserves within two months. As of Thursday, the exchange rate between the naira and the dollar stood at N768/$1, compared to N471.67/$1 before the devaluation on June 14, 2023.
