Nigeria's Reserves Surge Amid Ongoing Borrowing Concerns

At the BusinessDay CEO Forum in Lagos, Central Bank of Nigeria (CBN) Governor Olayemi Cardoso reported that Nigeria's net external reserves rose from roughly US$3 billion before September 2023 to about US$40 billion by July 2026, with gross reserves climbing to around US$52 billion. This increase provides approximately ten months of import cover and is presented as evidence of the success of difficult reforms over the past three years, leading to improved foreign-exchange liquidity, strengthened external buffers, and returning investor confidence.

However, this announcement has led to public scrutiny, with some commentators questioning why Nigeria continues to borrow and why major development programs remain unfunded despite the significant rise in reserves. Cardoso emphasized that external reserves are a strategic buffer and not a fiscal ATM, clarifying that they are not federal government revenue or funds available for immediate spending.

Reserves are built through foreign exchange inflows, which are managed by the CBN.