Nigeria’s ongoing financial-sector reforms have coincided with a return to a Balance of Payments (BOP) surplus, resilient diaspora remittances and steady accumulation of external reserves, underscoring improvements in external-sector fundamentals and investor sentiment.
The Central Bank of Nigeria (CBN) reported a BOP surplus of $4.60 billion in Q3 2025, reversing the deficit recorded in the previous quarter. The central bank attributed the turnaround to firmer trade performance, sustained remittance flows, higher financial inflows and continued accretion to external reserves—outcomes it links to recent reforms in the foreign exchange market, monetary policy and the domestic energy sector.
The current account moved into a $3.42 billion surplus in Q3, supported by a goods account surplus of $4.94 billion. Total goods exports rose to $15.24 billion in the quarter, up from $14.90 billion in Q2, driven by higher crude oil receipts and growing exports of refined petroleum products. Crude oil exports reached $8.45 billion, while refined product exports surged 44 percent to $2.29 billion, a trend the CBN says reflects gains in domestic refining capacity. Imports of refined petroleum products fell 12.7 percent to $1.65 billion, contributing to an improved trade balance.
The services account recorded higher net out-payments, increasing to $4.07 billion from $3.74 billion in Q2, largely on account of greater net imports of transport, travel, insurance, computer and information, business and government services. The primary income account also posted a larger debit balance, rising to $2.95 billion from $1.25 billion as domestic banks repatriated reinvested earnings on foreign investments.
READ ALSO: PDP Calls on Members to Contribute ₦10,000 Each in Bid to Fund Party Activities.
Secondary income flows remained sizable, though slightly lower quarter-on-quarter at $5.50 billion from $5.51 billion; workers’ remittances stood at $5.24 billion, narrowly down from $5.30 billion. The CBN continues to view diaspora remittances—estimated at about $23 billion annually—as a reliable foreign exchange source and is pursuing measures to boost formal inflows, with a goal of doubling receipts within a year.
On the financial side, the account recorded a net lending position of $0.32 billion. Foreign direct investment rose to $0.72 billion and portfolio investment inflows remained robust at $2.51 billion, reflecting improved investor confidence and sustained non-resident participation in domestic financial instruments.
External buffers strengthened during the quarter, with gross external reserves rising to $42.77 billion at end-September 2025 from $37.81 billion at end-June. The CBN says the reserves build-up has been largely organic, supported by stronger non-oil exports and improved market functioning following policy adjustments.
READ ALSO: Edo Communities Scramble for N40m as Kidnappers Issue Fresh Death Threats
CBN governor Olayemi Cardoso said the Q3 BOP outcome “underscores the strengthening of external sector fundamentals, higher investor confidence, and the sustained impact of reforms in monetary policy, the FX market, and the domestic energy sector.” Speaking at the 60th Annual Bankers’ Dinner, Cardoso reiterated the resilience of the banking system and outlined the bank’s 2026 priorities: strengthening the banking sector, ensuring price stability, modernising payments, deepening financial inclusion and supporting responsible fintech innovation.
Cardoso pointed to advances in digital payments, wider use of contactless cards, improved agent-banking oversight and Nigeria’s exit from the FATF grey list as confidence-enhancing developments. He said the CBN remains committed to disciplined, transparent and forward-looking policies to sustain stability and foster inclusive growth.
The central bank’s suite of reforms since 2023—liberalisation of the foreign exchange market, termination of central bank financing of fiscal deficits, fuel subsidy reform and stronger revenue collection—has, the CBN says, improved access to foreign exchange in the official market, raised international reserves and attracted foreign capital. Nigeria returned to international capital markets in December and received upgrades from rating agencies, while sovereign risk spreads have fallen to their lowest level since January 2020.
Policy shifts have included exchange-rate unification and the clearance of more than $7 billion in FX backlog, changes the CBN and multilateral partners describe as steps toward long-term sustainability. In parallel, the apex bank has pursued greater policy credibility by strengthening data analytics, ending monetary financing of the fiscal deficit and moving toward an inflation-targeting framework.
The CBN convened the Monetary Policy Forum 2025 to coordinate approaches to “Managing the Disinflation Process,” bringing together fiscal authorities, legislators, private-sector actors, development partners and scholars. Cardoso stressed that sustaining price stability requires fiscal-monetary coordination to anchor expectations, restore purchasing power and ease hardship, noting that monetary policy would remain forward-looking and adaptive.
Over the past year, Cardoso said, reforms have helped shift the economy from crisis management to a foundation for recovery. Real GDP grew by 4.23 percent in Q2 2025—the strongest rate in four years—buoyed by telecommunications, financial services and oil production. Inflation has trended down from a peak of 34.6 percent in November 2024 to 16.05 percent in October 2025, marking seven consecutive months of disinflation; food inflation fell to 13.12 percent in October from 21.87 percent in August.
To bolster the resilience of the financial system, the CBN recently introduced new minimum capital requirements for banks, effective March 2026, aimed at positioning the sector to support the country’s long-term growth ambitions, including a $1 trillion-economy target. Cardoso said the bank’s shift from unorthodox to orthodox policy frameworks is intended to restore confidence, strengthen policy credibility and maintain price stability, with measured monetary easing undertaken in response to improving macroeconomic indicators.
READ ALSO: CBN Forecasts Stronger Growth, Easing Inflation in 2026
The CBN has also developed multiple FX channels to expand dollar inflows and ease access for manufacturers and retail users. Initiatives include licensing additional international money transfer operators (IMTOs), improving diaspora remittance products, operating a willing-buyer willing-seller FX model and ensuring timely naira liquidity for IMTOs—steps the bank says have reinforced gross FX reserves and supported naira stability.
Market participants have noted changes in FX liquidity. Charlie Bird, director of Trading at Verto, said at a Cordros Asset Management seminar titled “The Naira Playbook” that dollar liquidity is now more balanced and that foreign investors and airlines are able to repatriate funds, making Nigeria a more attractive destination for investment following CBN reforms.
