Nigeria’s external reserves have dipped by $523m to $34.475bn as of March 16 from $34.998bn as of March 1, according to figures released from the Central Bank of Nigeria.
The external reserves, which had recently continued to spiral downward, lost $1.1bn in February, after it dipped from $36.19bn as of February 1, fell to $35.09bn as of February 26.
Recently, the Apex Bank stated that the country’s external reserves at $35bn were sufficient to finance seven months’ import.
When Nigeria’s reserves experienced an upsurge in the fourth quarter of 2020, the CBN said that at $36.46bn, it could finance 6.3 months of imports of goods and services or 8.4 months of import of goods.
According to the CBN’s monthly economic report for the last quarter of 2020, the performance of Nigeria’s external sector improved in the review quarter, notwithstanding the challenges of slow global recovery, weakened global demand, increasing second wave of the COVID-19 pandemic and a tense political environment in the United States of America.
In the monthly economic outlook report published by the CBN, it added that an estimated overall balance of excess payments of $0.79bn was recorded in the last quarter of 2020, from the $0.14bn recorded in the corresponding quarter of the same year.
The Apex Bank also stated that the shortage in the current account widened to $5.27bn in the review period, compared with $3.34bn in the previous quarter.
It stated, “A net disposal of $2.5bn was documented in the financial account, compared to $2.66bn in the corresponding quarter.
“The external reserves at end December 2020 was $36.46bn, compared with $35.67bn at end September 2020, indicating an increase of $0.79bn.
“This could finance 8.4 months of import of goods or 6.3 months of import of goods and services.”
The improvement in Nigeria’s external reserves stock was ascribed, mainly, to foreign exchange reforms undertaken by the Central Bank to block leakages and ensure a seamless inflow of remittances from Nigerians in the diaspora.