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Nigeria’s Foreign Reserves Slumps To $24b

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By Modupe Gbadeyanka

Minister of Budget and National Planning, Mr Udoma Udo Udoma, has disclosed that Nigeria’s foreign reserves have dropped to $24.74 in the third quarter of 2016 from $26.51 billion it was in the second quarter of the same year.

According to him, this was because Nigeria had revenue and foreign currency concentration problems.

Speaking at the 57th annual conference of Nigeria Economic Society (NES) in Abuja on Tuesday, the Minister further explained that the revenue and foreign currency concentration problems were caused by the destruction of four strategic pipeline terminals, which made it impossible for the Federal Government to achieve its 2016 Budget production target of 2.2 million barrels per day.

Mr Udoma, who spoke at the conference with the theme, “The developmental state and diversification of the Nigerian economy,” further said Nigeria was barely able to produce about 1.1 million bpd as at August, which affected the country’s revenue.

“Last week production level rose up to 1.7 million barrels, still a far cry from the country’s target of 2.2 million barrel.

“We are taking a number of immediate measures to raise revenues to strategically spend our way out of recession,” he said.

According to him, government was left with no choice but to diversify its economy and source for money elsewhere.

“We are fast-tracking our efforts to raise foreign currency loans that we have projected in the 2016 budget, from AfDB, World Bank, Chinese Exim Bank as well as Euro Bond issue.

“We are happy to note that the president of AfDB has announced that we should expect, among other facilities, a budget support of $1 billion dollars next month,” the Minister said at the conference.

He, however, emphasised that despite the challenges, the government was not “discouraged at all and this is a crisis we must not waste.”

“We should see this crisis as an opportunity for us as a country to make those major structural changes needed to change this economy for good.

“We should use this crisis to implement the reforms needed to unlock the economic potentials of the non-oil and high employment sectors,” he noted.

Dipo Olowookere is a journalist based in Nigeria that has passion for reporting business news stories. At his leisure time, he watches football and supports 3SC of Ibadan.

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