The Central Bank of Nigeria (CBN) Governor, Olayemi Cardoso, announced plans to diversify the nation’s foreign exchange reserves during his address at the Afreximbank Annual Meetings (AAM) in Abuja. Speaking to an audience of policymakers and financial leaders, Cardoso outlined a strategy to reduce Nigeria’s reliance on the U.S. dollar by increasing holdings in other major currencies, such as the euro, yen, and yuan, alongside assets like gold and Special Drawing Rights (SDRs). At the current exchange rate of N1,579/$1, Nigeria’s $32.7 billion reserve base, per CBN data, could see significant restructuring to shield the economy from global shocks, amid 23.71% inflation and a projected 6% naira depreciation by mid-2026, according to the African Development Bank.
While details of the diversification plan were not disclosed, Cardoso emphasized its role in broader forex market reforms aimed at stabilizing the naira, which gained 1.28% to N1,585.50/$1 in May 2025. A key initiative includes the introduction of two financial products: the Non-Resident Nigerian Ordinary Account and the Non-Resident Nigerian Investment Account. These platforms, designed for the diaspora, aim to boost remittances—estimated at $20 billion annually by the World Bank—and encourage investment in critical sectors like energy and manufacturing. “These accounts will provide a secure, efficient way for Nigerians abroad to manage funds and invest in our markets, fostering economic growth,” Cardoso stated, per BusinessDay. The initiative aligns with efforts to capture the 91% of dollar liquidity outside formal channels, as noted by ABCON.
Cardoso stressed the need for African nations to build resilience against global economic volatility, citing Nigeria’s banking sector liquidity surge, with N53.5 trillion ($33.9 billion) deposited in the CBN’s Standing Deposit Facility in 5M’25. He underscored confidence-building measures, including the CBN’s clearance of a $7 billion forex backlog, earning him the 2025 Central Bank Governor of the Year award from African Banker Awards. Posts on X, like @vanguardngrnews, praised the diversification move, while @Nairametrics noted its potential to reduce exposure to U.S. monetary policy shifts, such as Federal Reserve rate hikes.
At the AAM, Afreximbank Senior Vice President Denys Denya reflected on the bank’s 32-year journey, overcoming initial resistance to become a cornerstone of African finance. From a $750 million capital base, Afreximbank’s assets now exceed $40 billion, with $52 billion invested in Nigeria since 1993, per Leadership. Key projects include the $500 million African Medical Center of Excellence in Abuja, reducing Nigeria’s $1 billion annual medical tourism costs, and $300 million export manufacturing hubs in Cross River, Enugu, and Kano, boosting industrial clusters. A $3 billion intra-African petroleum trade facility has also enhanced Nigeria’s energy security, supporting Dangote Refinery’s N219.38 billion crude supply in 2025.
Vice President Kashim Shettima, via Special Adviser Dr. Tope Fasua, lauded Afreximbank’s $100 billion disbursements across Africa, with Nigeria as the largest beneficiary. “These investments, from quality assurance centers in Kaduna to petroleum trade facilities, are transforming Nigeria’s economic landscape,” Shettima said, per The Punch. However, analysts like Dr. Muda Yusuf of CPPE warn that diversification must be paired with increased crude output—currently at 1.544 million bpd, below the 2.06 million bpd budget target—to sustain reserves. Pipeline vandalism, with 177 illegal connections reported by NNPCL in June, remains a hurdle.
The CBN’s move, alongside Tinubu’s tax reform bills signed on June 26, signals a broader push for economic self-reliance. With global uncertainties, including Israel-Iran tensions driving oil prices to $76.60 per barrel, Nigeria’s reserve diversification could enhance fiscal stability, provided implementation navigates domestic challenges like a 50% Cash Reserve Ratio and forex volatility.
