The Central Bank of Nigeria (CBN) has shown that Nigeria’s provisional Balance of Payments (BOP) data for the first quarter of 2025 dropped by 1.8 per cent to the current account surplus of $3.73 billion, slightly down from $3.80 billion in the fourth quarter of 2024, but up from $3.69 billion in the first quarter of 2024.
Balance of Payments refers to all economic transactions between residents of Nigeria and the rest of the world over a specific period .
A stronger goods drove the surplus account balance of $4.16 billion, buoyed by a 9.8 per cent increase in exports to $13.91 billion, and a decline in imports to $9.75 billion, particularly non-oil imports.
However, the services account and the primary income account posted higher deficits of $3.69 billion and $2.02 billion, respectively, while the secondary income account remained positive at $5.29 billion, although this was lower than the previous quarter.
On the financial account, a net balance of $7.58 billion was recorded, reflecting a significant reversal of $5.03 billion in portfolio investment inflows. Despite a resilient current account, the overall BOP recorded a deficit of $2.77 billion due to sustained capital outflows and debt repayments.
At the end of the March 2025, Nigeria’s external reserves declined to $37.82 billion.
The data present a strong need for policies that enhance capital retention and attract stable, long-term investment into the country with a target of $1 trillion gross domestic product (GDP) by 2030.
Considering sustained external pressures, strengthening Nigeria’s macroeconomic fundamentals, particularly through export diversification, investment climate reforms, and improved capital controls, will be crucial for ensuring external sector stability over the medium term.
Market analysts noted that this can be achieved by implementing targeted policies that broaden Nigeria’s export base beyond oil, streamline regulatory and tax frameworks to attract productive investment, and reinforce oversight of foreign exchange and capital flows to safeguard the external reserves.
According to the International Monetary Fund (IMF), significant challenges remain for Nigeria with inflation still exceeding 20 per cent while poor infrastructure inhibits economic activity. It added that poverty and food insecurity remain high.