FX Market Unification Saves Nigeria $16.8bn Annually – Think Tank

The Independent Media and Policy Initiative (IMPI) has said that President Bola Ahmed Tinubu’s decision to unify Nigeria’s multiple foreign exchange windows has saved the country an estimated $16.8 billion each year that was previously spent on defending the naira.

In a policy statement signed by its Chairman, Dr Omoniyi Akinsiju, the think tank disclosed that successive administrations spent a combined $388 billion between 2000 and 2023 trying to stabilise the naira through foreign exchange interventions, with little lasting success.

$388 Billion Spent, Naira Still Weakened

According to IMPI, despite the huge expenditure over 23 years of democratic rule, the naira continued to depreciate against the US dollar. The group said available records show that the Obasanjo administration spent about $60 billion defending the naira over eight years. The Yar’Adua administration expended approximately $58 billion in three years.

“The Jonathan administration recorded the highest intervention, spending about $145 billion over five years, while the Buhari administration spent roughly $125 billion during its eight-year tenure,” the statement said.

IMPI described the cumulative $388 billion expenditure as a missed opportunity that could have strengthened Nigeria’s external reserves and financed economic development. It noted that despite the interventions, the official exchange rate weakened from about N22/$1 in 1999 to N460/$1 by May 2023. The parallel market rate depreciated from N80/$1 to N780/$1 during the same period.

Tinubu’s Model Shows Early Gains

By contrast, the think tank said the Tinubu administration has adopted a more efficient foreign exchange management model. It stated that Central Bank of Nigeria (CBN) interventions totalled about $7.8 billion between 2024 and 2025. Meanwhile, the naira appreciated by 7.14 per cent over 12 months in 2025, reversing years of persistent depreciation.

“Nigeria’s foreign exchange ecosystem is now celebrated globally for its predictability and stability, largely because of the policy of harmonising the foreign exchange windows,” the statement said.

According to the report, the unification of the foreign exchange market, combined with the administration’s Nigeria First local content policy, has increased the competitiveness of locally manufactured goods. It said this was achieved by making imports more expensive and encouraging the use of domestic inputs.

The group said the policy shift has helped reposition Nigeria from an import-dependent economy towards an export-surplus economy. This resulted in a trade surplus of more than N6.69 trillion by the end of 2025.

Previous Administrations and Missed Fiscal Opportunities

IMPI also attributed the country’s fiscal challenges before 2023 to what it described as populist economic policies pursued by previous administrations.

“Our investigation of the fiscal developments that culminated in the economic crisis of 2023 showed that the problems were rooted in the populist economic model adopted between 1999 and 2015,” the statement said.

The report noted that Nigeria earned an estimated $994.4 billion in oil and gas revenues between 1999 and 2015. The Obasanjo administration generated about $401.4 billion in crude oil revenue and saved over $9 billion in the Excess Crude Account. The Yar’Adua administration realised between $120 billion and $130 billion. Oil and gas revenue exceeded $454 billion during the Jonathan administration.

Despite the substantial earnings, IMPI said the three administrations left behind a combined external and domestic debt of about $65.49 billion. They also left foreign reserves of $29.61 billion, of which only $28.74 billion was liquid and approximately $875 million was inaccessible to the succeeding administration.

The think tank argued that the large revenues generated during the period were not effectively translated into sustainable economic assets, describing the outcome as a significant fiscal opportunity lost.

For the naira and Nigerian businesses, the IMPI analysis suggests that the unification policy is already reducing the need for costly interventions, improving market confidence, and supporting a shift toward local production. Sustaining this path could mean less pressure on the currency and a more predictable environment for importers and exporters alike.