In a positive development for Nigeria’s economic outlook, the Governor of the Central Bank of Nigeria (CBN), Yemi Cardoso, has announced a renewed interest from foreign portfolio investors (FPIs) in the Nigerian market. This revelation, made during an exclusive interview with Arise Television on Monday, indicates a potential shift in the attractiveness of the country’s financial market.
Addressing key issues related to foreign exchange and investment, Cardoso emphasized the need to leverage existing resources to attract more foreign direct investment and portfolio inflows. Contrary to the perception of FPIs as “hot money,” the governor sees these investments as crucial elements of a diversified foreign exchange portfolio, whether sovereign or corporate.
“This is a problem I sometimes have when many blame the central bank for the foreign exchange situation. It is a problem I have because we rely on what comes in. We don’t produce foreign exchange… All we can try and do is use that to leverage for more to start coming in, and that also includes foreign direct investment and foreign portfolio investors,” Cardoso stated.
Highlighting recent strategic financial decisions, such as the Nigerian National Petroleum Corporation (NNPC) and other major MDAs moving their funding directly to the central bank, Cardoso sees these moves as strong confidence boosters. They indicate that Nigeria aligns with the directions favored by global investors.
“The recent move to have NNPC and some of the other MDAs move their funding straight to the central bank also sends a powerful signal. It boosts confidence that Nigeria is finally going in the direction that many investors want to see it go,” Cardoso explained.
Expressing optimism about the Nigerian economy, particularly regarding foreign investments, Cardoso expects this confidence to stabilize the Naira, which he believes is undervalued due to panic-induced distortions.
“The time for panic and cynicism is not now. We are on the road now where the right policy decisions are being taken,” Cardoso affirmed, emphasizing the CBN’s commitment to steering the Nigerian economy towards growth and stability. The governor also stressed the apex bank’s commitment to clearing the balance of the FX backlog in a very short time.
