The Central Bank of Nigeria (CBN) has revealed that the country’s external reserves have increased by $243.83m in 19 days, thus bringing it to $39.78 on April 19, 2022.
The CBN said the reserves was $39.54bn on April 1, 2022 adding that it fell by $313m in March, after starting the month at $39.86bn, before falling to $39.55bn on March 30.
The CBN Governor, Godwin Emefiele told the last Monetary Policy Committee meeting that “The moderate accretion to reserves reflects the duality of Nigeria’s position as an oil exporter and importer of refined petroleum products.”
A member of the Monetary Policy Committee, Prof. Mike Obadan, said for a long time, the oil sector had contributed over 90 per cent of the nation’s foreign exchange earnings and external reserves accretion.
Obadan added that crude oil and gas export receipts have been significant contributors to the government’s naira revenue. “But for some time now, this has not been so due to two factors: a huge volume of crude oil theft which has prevented the country from meeting even the OPEC-approved production quota, and the inability of the NNPC, for many months, to make any remittance from direct oil export sales into the Federation Account and external reserves account.
“These are alarming developments which have adversely impacted government’s finances, external reserves accretion and exchange rate stability.
“The inhibiting factors are what the government can check in the short-term.”
According to Obadan, it was not possible that all the foreign exchange earned from the export of crude oil and gas was used to import refined petroleum products or that ‘under-recovery’ / petroleum subsidy was absorbing all the foreign exchange earned from oil sales.
The professor said, “I will therefore strongly appeal to the government to appreciate the grave implications of the oil sector and NNPC’s underperformance and effectively deal with the oil thefts and non-remittance of foreign exchange/naira revenue.
“If, in the presence of the array of security forces in the oil-producing areas, monumental oil theft is taking place to the detriment of the economy, then drastic measures are called for.
“Government should check the untoward developments, through effective security and monitoring, and the positive impact on government finances, external reserves and exchange rate stability will be visible in a short period.”
