The country’s foreign reserves have continued its downward trend, dropping by $5.09bn from $38.53bn on January 2, 2020 to $33.44bn as of April 28, 2020, latest statistics from the Central Bank of Nigeria have revealed.
According to the figures, the reserves dropped from $39.8bn on November 11, 2019 to $39.24bn on December 13, 2019. This is after the fall by $1.26bn from $41.76bn on October 2 to $40.5bn as of the end of October.
The reserves dropped by $482.18m from N45.14bn as of July 8 to $44.65bn on August 8, 2019.
During the last Monetary Policy Committee meeting of the banking sector, Godwin Emefiele, the Central Bank governor, said the committee noted the weakened revenue position of the Federal Government, arising from the sharp drop in oil prices.
He reiterated the need for government to urgently reduce reliance on oil revenue by gradually diversifying the economy and improving tax collection.
On the domestic front, he said available data on key macroeconomic variables indicated the likelihood of subdued output growth for the Nigerian economy in 2020.
He said, “Based on the current downturn in oil prices, staff projections indicate that output in the 2020 would be less than earlier envisaged.
“The major downside risks to this outlook, however, include the continued spread of COVID-19; further decline in crude oil prices and the reduction in accretion to external reserves.”
Emefiele said the headwinds would, however, be partly mitigated by the timely and effective response of the monetary and fiscal authorities in containing the spread of the COVID-19 pandemic, the recalibration and adjustment of the 2020 federal budget to the revised thresholds.