The Governor of the Central Bank of Nigeria, Olayemi Cardoso, revealed that the Nigerian government spent N6.2 trillion on foreign exchange (FX) subsidies in 2022 alone, surpassing the N4.5 trillion spent on fuel subsidies.
Cardoso made this disclosure during the 59th Annual Bankers Dinner of the Chartered Institute of Bankers of Nigeria (CIBN) in Lagos.
He pointed out that in recent years, the losses from FX subsidies have been a greater burden on the country’s revenue than fuel subsidies.
“In 2022 alone, the potential revenue total revenue lost due to a less reflective FX regime is approximately N6.2 trillion compared to 4.5 trillion from fuel subsidies.
“We have all been complaining about the loss of government revenue from fuel subsidies, yet the loss from the past FX subsidy regime far exceeds that of fuel.
“The real elephant in the room is the losses from the FX regime.”
It is worth noting that in June of the previous year, the Nigerian government announced the floating of the Naira and the removal of the fuel subsidy.
These twin policies had a delayed impact on Nigeria’s economy, as inflation surged to 33.88%, and the exchange rate hit N1672.69 per dollar, compared to 22.41% inflation and N463 per dollar between May and June 2023.
