How CBN’s FX Reforms Are Powering Nigeria’s Economic Turnaround

Abdulsamad Rabiu, Chairman of BUA Group, one of Nigeria’s largest conglomerates, recently reflected on this dramatic shift in the country’s foreign exchange landscape, submitting that the new ways are better and easier for entrepreneurs.

“Every two weeks, we would go to Abuja to seek allocations. It was exhausting and inefficient… Today, I have met the new CBN Governor, Mr. Cardoso, only once in two years. The reason is simple: I do not need to go to Abuja now to get foreign exchange. The system is open. It is working,” Rabiu said.

This change is the result of sweeping foreign exchange reforms spearheaded by Central Bank of Nigeria (CBN) Governor Olayemi Cardoso. Since taking office in 2023, Cardoso has dismantled the opaque and bureaucratic system that previously dictated how businesses accessed foreign exchange, replacing it with a more transparent, market-driven framework.

Key to the success of these reforms is the unification of Nigeria’s multiple exchange rate windows, a major source of confusion and corruption in the past. Under Cardoso, the CBN has also cleared a backlog of over $7 billion in unmet FX obligations and introduced an Electronic FX Matching System (EFEMS) in late 2024, further improving accessibility and transparency.

As a result, the Nigerian naira has stabilized, investor confidence is rebounding, and businesses now have easier and fairer access to foreign exchange.

Beyond improving ease of doing business, the reforms have had a significant impact on government finances and public spending.

“The money saved is now being channelled to infrastructure, to better support for states, and to other developmental priorities.

“All the states are receiving more money now, and that has made a real difference,” Rabiu noted.

The Federal Inland Revenue Service (FIRS) reported record revenue collections of ₦21.6 trillion in 2024, exceeding targets by over 111%.

In addition, foreign reserves have climbed above $40 billion the highest in nearly three years while diaspora remittances surged 79% in 2024, reaching $4.18 billion.

Nigeria’s reforms have also restored the faith of international investors. Portfolio inflows rose by 72% in the first half of 2024 compared to the same period the year before, a clear indication that the global market is once again looking at Nigeria as a viable investment destination.

“Our aim is to create a transparent system and an environment where those who need foreign exchange can easily access it,” Governor Cardoso said at a recent economic summit in Lagos.

While challenges remain particularly in managing inflation and ensuring broad-based economic growth

the FX reforms are widely regarded as one of the most successful policy shifts in recent Nigerian history.

With improved transparency, increased public revenue, and renewed investor interest, Nigeria appears to be on a more sustainable economic path.

For business leaders like Rabiu, the difference is clear: “Now, I can focus on running my business instead of chasing dollars. That alone is a revolution.”

Sources: Central Bank of Nigeria, Federal Inland Revenue Service, ThisDay Live, Financial Times, Reuters, Pulse Nigeria.