Olayemi Cardoso, Governor of the Central Bank of Nigeria (CBN), has called for stronger economic ties with the Middle East and the Nigerian diaspora community in the region.
Gatekeepers News reports that Cardoso spoke on Monday during a meeting with Talal Al-Humond, assistant governor for monetary affairs, Saudi Arabia Central Bank (SAMA), on the sideline of the just-concluded inaugural conference on emerging Markets Economies organised by the Ministry of Finance, Saudi Arabia, and the International Monetary Fund (IMF) regional office in Riyadh.
The event was held in Al Ula, Saudi Arabia, from February 16 to 17.
Cardoso said there were lessons to be learned from Saudi Arabia in terms of infrastructural development and tourism.
According to Cardoso, “Saudi Arabia’s dedication to diversifying its economy through innovative environmental projects, large-scale transformation, and tourism investment is essential for development”.
He reaffirmed his dedication to collaborating with the Nigerian diaspora community in the Middle East to improve remittance flows and strengthen Nigeria’s financial sector.
The CBN governor also said the apex bank will continue enhancing macroeconomic fundamentals to establish an enabling environment that will facilitate the growth of the private sector and the generation of high-quality jobs for Nigerians.
In his response, Talal Al-Humond assured Cardoso that the Saudi Central Bank will work with the CBN to ensure the attainment of mutually beneficial objectives.
Also, speaking during a panel discussion at the conference, moderated by Jihad Azour, IMF director for Middle East and Central Asia department, Cardoso cited reforms in the financial markets that addressed distortions in the Nigerian foreign exchange market.
The CBN governor said previously, the gap between the official and parallel market exchange rates was up to 60 percent.
He noted that due to consistent policy direction, improved market confidence, and enhanced transparency in forex trading, the gap has significantly narrowed to approximately 4 percent to 5 percent.
Cardoso also highlighted the adoption of an electronic matching system to improve transparency in the market and the introduction of a foreign exchange code of ethics, which all Nigerian banks signed to ensure adherence to market rules.
“As a result of these measures, the country’s foreign reserves has exceeded $40 billion, marking the highest level in nearly three years,” he said.
He also said Nigeria had faced significant economic challenges, including capital flow exits, multiple exchange rate regimes, currency depreciation, high inflation, and a backlog of foreign exchange transactions, which led to a loss of confidence in the country’s currency.
Upon assuming office, he said his team prioritised restoring confidence in the market by addressing the backlog of foreign exchange transactions and demonstrating a commitment to economic stability.
Cardoso added that Nigeria implemented a tight monetary policy stance to tackle inflation and restore macroeconomic discipline.
“Over the past year, the bank raised interest rates by 850 basis points and shifted away from quasi-fiscal interventions that had distorted the economy,” he said.
He said Nigeria’s approach had remained firmly rooted in orthodox monetary policies, a stance that was consistently communicated to market participants.
Another significant reform, he noted, was the removal of the petrol subsidy, which, along with multiple exchange rate inefficiencies, had cost the country approximately 6 percent of its gross domestic product (GDP) annually.
On financial sector reforms, he said the CBN had mandated banks to recapitalise to strengthen the financial system and build buffers to withstand future economic shocks, adding that the measures had so far proven successful in bolstering the sector.
Cardoso reaffirmed the CBN’s commitment to maintaining macroeconomic stability, sustaining policy consistency, and ensuring long-term resilience for the Nigerian economy.
