President Bola Tinubu said the liquidity squeeze that has resulted in the naira weakening to record lows against the dollar will ease.
“My government is not blind to the challenges several of you are facing in the financial markets,” Tinubu said on Monday at the Nigerian Economic Summit in the capital, Abuja. “I can only allay this concern by revealing that we have a good line of sight for the additional foreign-exchange liquidity that is required to restore market confidence and we are going to do that soon.”
Tinubu also reiterated his pledge to work closely with the private sector to implement the range of reforms he’s introduced since coming to power in May.
Naira slid to the brink of 1,000 per dollar on the official market, thanks to a combination of central bank tolerance for a weakening currency and insatiable demand for the greenback.
The currency was pushed to its latest record a week after the central bank ended curbs on using dollars to buy dozens of imported items. Nigerians also typically make payments for tuition at foreign schools and universities around this time of year, adding to demand for the greenback.
Nigeria’s government spent $3.5 billion servicing its debt in the first half of this year, the Budget Office said.
The authorities paid $1.17 billion in interest on its external debt and $2.68 billion on domestic debt, it said in a statement. Last year, Nigeria spent a total of $8.1 billion servicing outstanding debt, up 15% from 2021.