CBN Says It’s Preparing Nigeria’s Financial Sector for $1tn Economy, But Analysts Doubt Tinubu’s Broader Economic Policies Will Deliver

The Central Bank of Nigeria (CBN) aggressively pursues policies to strengthen the country’s financial sector and position it for an economy of a dollars Billion, the Governor of CBN Olayyemi Cardoso announced on Thursday at the 2025 monetary policy forum in Abuja.

Addressing an audience of tax authorities, legislators, private sector leaders, development partners and economic researchers, Cardoso described the CBN strategy to manage disinflation while maintaining a prospective and resilient monetary policy.

A major board of the vision of the CBN for a stronger economy is the introduction of new requirements of minimum capital for banks, which should take effect in March 2026. Cardoso stressed that this decision aims to strengthen The banking sector to support Nigeria’s aspirations for an economy of $ 1 Billion.

This initiative reflects the 2005 banking consolidation exercise, which saw the number of banks decrease, but also led to a more robust and competitive banking system. However, current public offers and the rights of certain banks have been overwritten.

The recapitalization campaign occurs when economic turbulence and high inflation have eroded the real value of the capital of banks, leaving them more vulnerable to external shocks. With the mandate of the CBN to ensure financial stability, the strengthening of banks is seen as A crucial step towards economic resilience.

Restore confidence in the Nigeria FX market

Another essential element of the CBN strategy is a complete overhaul of the Nigeria (FX) foreign exchange market. This week, the Apex bank launched the Nigeria foreign trade code, a decision aimed at promoting Integrity, equity, transparency and efficiency of Forex transactions.

“Built on six basic principles, it represents a binding commitment to the financial community to rebuild trust and inspire confidence,” said Cardoso.

Under its leadership, the CBN has taken decisive measures to dismantle past Forex policies that have created distortions and encouraged speculation on currencies. A major change has been The reversal of The 2015 ban on 41 articles to access Forex on the official market, a policy introduced by the former Governor of CBN Godwin Emefiele.

In addition, the CBN focused on increasing the Diaspora funds, a key source of the Forex influx. According to Cardoso, funding from funds through international money transfer operators (IMTOS) jumped 79.4% to reach $ 4.18 billion in the first three quarters of 2024, reflecting the positive impact Recent Forex market reforms.

Financial inclusion and women’s empowerment

Cardoso also underlined the commitment of the CBN to financial inclusion, in particular through initiatives that allow women of entrepreneurs. The Women Entrepreneurs Finance (WE-FI) initiative, operating within the framework of the national financial inclusion strategy, aims to fill the gap between the sexes by offering more women access to financial services and digital banking tools .

In a country where millions of people are not banished, CBN’s push for financial inclusion is considered a key strategy to stimulate economic growth. Expanding access to formal financial services could unlock new commercial opportunities and increase interior savings and investments.

Will the verification of reality: Will Tinubu’s economic policies offer an economy of $ 1 Billion?

While the CBN implements critical reforms, economic analysts are skeptical about the fact that the broader economic policies of Nigeria with President Bola Tinubu will create the conditions necessary for an economy of a billion dollars.

A major concern is the persistent economic difficulty, the increase in inflation and the drop in purchasing power which blocked economic growth despite the adjustments of monetary policy. Analysts argue that for Nigeria to reach an economy of $ 1 Billion, the government must implement fundamental reforms beyond banking policies and Forex.

Some of the main challenges that threaten Nigeria’s economic ambitions include:

1. Inflationary pressures: Despite the tight monetary position of the CBN, inflation remains stubbornly high, which makes it difficult for businesses and households to prosper.
2. Forex volatility: Although the CBN has introduced reforms, the exchange rate remains unstable, the periodic depreciation of money always threatening the confidence of investors.
3. Budget deficit and public debt: The growing charge of Nigeria and the widening of the budget deficit imposed constraints on public spending.
4. Low infrastructure and failure in the energy sector: The absence of stable electricity, poor road networks and inadequate infrastructure continue to stifle economic productivity.
5. Direct foreign investment (IDE) in decline (IDE): Foreign investors remain cautious due to political uncertainty and concerns about governance and security.

The economic expert, Dr. Bismarck Rewane, CEO of Financial Derivatives Company, recently noted that without complete structural reforms, Nigeria will find it difficult to achieve the economic objective of $ 1 Billion. He argued that if monetary policy adjustments are important, Nigeria needs a strong industrial basis, a functional energy sector and a stable commercial environment to achieve significant economic growth.

Since he has assumed his duties, President Tinubu has introduced major economic reforms, in particular the deletion of Fuel grants and exchange rate unification. While these movements were considered daring steps towards economic Stability, their short -term effects have been serious, which has brought about higher transportation costs, an increase in food prices and generalized economic difficulties.

With public confidence, many Nigerians and companies are not convinced that the government has a clear roadmap for economic prosperity. Formerly the greatest economy in Africa, Nigeria is now the fourth economy on the continent, with $ 252.74 billion in gross domestic product (GDP).

Without a concrete action on the creation of jobs, industrialization and the development of infrastructure, many believe that the economic objective of $ 1 Billion remains a dream.