The World Bank has advised Nigeria to implement deeper foreign exchange reforms, strengthen monetary policy communication, and expand non-oil revenue to sustain the naira’s stability.
In its ‘Nigeria Development Update’ report released Wednesday, the Bank said recent policies have improved FX market operations but warned that dependence on short-term capital inflows still exposes the economy to external shocks.
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It urged the government to prioritise long-term inflows from oil, remittances, and especially non-oil exports, while gradually easing restrictions on banks’ foreign exchange positions. The Bank noted that a more transparent and market-driven FX framework, backed by confidence-building reforms, is essential for durable stability.
Although the naira has shown resilience under the unified exchange rate system, the World Bank cautioned that Nigeria’s high inflation could undermine recent competitiveness gains.
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