Key points

• Nigeria posts a $6.83 billion balance of payments surplus in 2024.

• Key reforms, better trade performance, and improved data quality contributed to the surplus.

• Nigeria’s external reserves rose by $6 billion, reaching $40.19 billion.

Nigeria has posted a balance of payments surplus of $6.83 billion in 2024, marking the first time in three years that the country has seen a surplus after consecutive deficits.

The Central Bank of Nigeria (CBN) announced the achievement in a statement on Tuesday, signed by its Acting Director of Corporate Communications, Hakama Ali.

Key drivers of the surplus

The balance of payments tracks the money flowing in and out of a country. It gives a clear picture of a country’s economic health and helps policymakers make informed decisions.

According to the CBN, the 2024 surplus was a result of key economic reforms, better trade performance, and improvements in data reporting. In contrast, Nigeria posted deficits of $3.34 billion in 2023 and $3.32 billion in 2022.

Exports rise as imports fall

A major factor in the surplus was Nigeria’s improved trade performance. The country’s current and capital accounts showed a surplus of $17.22 billion, driven by a $13.17 billion surplus in goods trade.

Petroleum imports dropped by 23.2 percent to $14.06 billion, while non-oil imports fell by 12.6 percent to $25.74 billion.

On the export side, gas exports surged by 48.3 percent to $8.66 billion, and non-oil exports rose by 24.6 percent to $7.46 billion.

Nigeria also saw an increase in personal remittances, which rose by 8.9 percent to $20.93 billion.

Additionally, inflows from International Money Transfer Operators (IMTOs) rose by 43.5 percent to $4.73 billion. Official development assistance increased by 6.2 percent to $3.37 billion.

Investment inflows and reserves growth

Portfolio investment inflows more than doubled, growing by 106.5 percent to $13.35 billion. Foreign currency holdings by residents also increased by $5.41 billion, reflecting stronger confidence in Nigeria’s economy. However, foreign direct investment fell by 42.3 percent to $1.08 billion.

Nigeria’s external reserves rose by $6 billion, reaching $40.19 billion by the end of 2024. Additionally, the country’s net acquisition of financial assets totaled $12.12 billion, indicating a healthier financial position.

Reforms contribute to success

The CBN attributed Nigeria’s positive results to crucial reforms, including the liberalization and unification of the foreign exchange market, stricter monetary policies to control inflation and stabilize the naira, and better coordination between fiscal and monetary authorities.

“The positive turnaround in our external finances is evidence of effective policy implementation and our unwavering commitment to macroeconomic stability,” said the CBN governor.

“This surplus marks an important step forward for Nigeria’s economy, benefiting investors, businesses, and everyday Nigerians alike.”