The World Bank will support Nigeria’s 2017 budget with $2.5 billion worth of loans provided Africa’s largest economy reforms its Foreign Exchange (FX) market.
Thank you for reading this post, don't forget to subscribe!The Central Bank of Nigeria (CBN) removed a currency peg in June, 2016 but continued to intervene to keep the naira at about N315 against the U.S. dollar, compared with almost N500 on the parallel market.
Trading volumes on the interbank FX market have increased since then but remain low at $8.4 billion in December 2016, compared with $24 billion in December 2014.
The lack of an economic plan some 20 months since the Buhari administration came to power, has stalled the disbursing of up to $5 bn in loans from the Africa Development Bank (AfDB), World Bank and other foreign sources.
The FGN intends to finance an estimated N2.36 trillion fiscal 2017 deficit largely through borrowings with 46 % of planned issuance coming from foreign sources.