Emefiele lists gains of FX restriction on 41 Items…outlines projections for 2018

 The Governor, Central Bank of Nigeria (CBN), Mr. Godwin Emefiele
says the dogged implementation of the Bank’s policy, which
restricts importers of certain items access to foreign
exchange from the Nigerian Forex market, has led to
improvements in the domestic production of those items and a
reduction in Nigeria’s import bill.

Delivering the 2017 Annual Bankers’ Dinner of the Chartered Institute
of Bankers of Nigeria (CIBN) in Lagos at the weekend, Mr.
Emefiele asserted that local manufacturers were recording
profits and major boosts to their revenue due to the

According to him, in spite of opposition to the introduction of the
policy restricting 41 items from Nigeria’s foreign
exchange market, the faithful implementation of the policy
had seen to the considerable decline in Nigeria’s import
bills. From an average of about US$5.5 billion, he disclosed
that the nation’s monthly import bill had fallen
consistently to US$2.1 billion in 2016 and US$1.9 billion by
half year 2017.

Citing the example of Psaltry International Limited (PIL), an
agro-allied company based in Oyo State, he said the
introduction of the policy had reversed the fortunes of the
starch-producing company. He noted that prior to the policy;
Psaltery had only few customers and a huge backlog of

However, due to the policy, he disclosed that the
company now has over 50 multinational clients including
Nestle and Unilever, thereby saving the country $7 million
in foreign exchange drawdown over the two years of the

While also asserting that the access restriction policy had freed
Nigeria from the perennially embarrassing importation of
toothpicks, the CBN Governor disclosed to the delight of the
audience that as part of the gains from the policy and in
line with an agreement reached with Unilever, which moved
its production facility to another country a few years ago,
the company had agreed to commission a new Blue Band Factory
in Agbara, Ogun State before the end of

Mr. Emefiele further disclosed that the implementation of the
policy had had a great impact on Nigeria’s import bill and
boosted local rice production in Nigeria. He recalled that
Nigeria, in 2012, imported about 1.2 million metric tonnes
of rice from a trading partner, noting that, in 2016, one
full year of implementation of the policy, rice exports to
Nigeria had fallen by 99 percent to only 784 metric

“These are clearly verifiable successes of government’s attempts
to create jobs locally, improve the wealth of our rural
population, improve industrial capacities and ultimately
attain economic growth in Nigeria,” he

On the current position of the economy, Mr. Emefiele expressed
delight that the Nigerian economy had recorded positive
growth after five consecutive quarters of negative growth,
thereby signaling its exit from recession. He also noted the
downward trend in headline inflation from 18.72 per cent in
January 2017 to the September 2017 figure of

The CBN Governor equally expressed gladness that the Naira had
appreciated from over N500/US$1 to about N360/US$1. While
noting that the economy had seen stability in the exchange
rate of the naira for over six months, he affirmed that the
exchange rate was not only stable, but was also converging
across various windows and segments of the

He noted that since the establishment of the Import and Export
Window, the CBN had recorded about US$10 billion in
autonomous inflows through this window alone. According to
him, this reflected the effect of the increased transparency
which that window accorded the foreign exchange market and
its impact of improving investor confidence and business

Speaking on the country’s reserves, Emefiele noted that the
reserves had recovered significantly from about US$23
billion in October 2016 to over US$34.3 billion as at
November 3, 2017.

“The accretion in reserves does not only reflect increased inflow
but also our shrewd FX demand management strategy,” he
added, in assessing the country’s rating on the ease of doing
business, he disclosed that the World Bank’s ease of doing
business indicator for 2018 showed that Nigeria, with a
score of 52.03, improved 24 places to rank 145 out of 190,
standing above the regional average
score of 50.43 recorded for sub-Saharan Africa.

This is even as he noted that the Bank’s effort had reinforced the
Presidential initiatives to improve ease of doing business
in Nigeria.

Speaking on the economic outlook for 2018, Emefiele warned fiscal and
monetary authorities against complacency and over-confidence
because of current positive developments in the economy.
Rather, he urged all to strive to improve and sustain the
pace of recovery.

Although he noted that the import bill had dropped, he stressed that
Nigeria’s manufacturing and agriculture sectors still had
a long way to go if the country were to attain
self-sufficiency in those sectors. Nevertheless, he assured
that the CBN, on its part, would continue to fine-tune its
policies and strategies based on its understanding of
evolving developments and supported by in-house technical
analysis and simulations.

He assured that the CBN would remain proactive in ensuring                                                                           that the welfare of Nigerians is optimised at any point in time.

Specifically, Mr. Emefiele noted that, that barring any unforeseen shocks,
Inflationary pressure will continue to ease, expressing
optimism that the rate may return to very low double digit
or high single digit levels during the next year.

He also expressed hope that the foreign exchange reserve will
continue to grow; stressing that Nigeria can attain a
foreign reserve position of about US$40 billion by end of

Mr. Emefiele also expressed hope that the economic recovery
would consolidate and that the exchange rate stability
currently being witnessed would continue. While expressing
hope for even stronger policy coordination, collaboration
and cooperation in 2018, he hinted that monetary policy
stance could change when the underlying fundamentals become

While expressing delight that some of the pains that were
associated with some of the CBN’s policies had become
major gains in Nigeria’s economy, Mr. Emefiele urged all
stakeholders to work towards creating a Nigeria, where
balanced growth and shared prosperity is guaranteed for