Balance of Payments and International FDI Position in Nigeria: FY2019/20

Nigerian merchandise export earnings have been recovering from the period of low commodity prices from 2014 to 2016. The faster growth in export earnings has not been sufficient to improve Nigeria’s current account balance. The volatile current account balance has deteriorated Nigeria’s balance of payments but gross official reserves have increased due to the persistent inward foreign direct investment (FDI) inflows. These capital flows have been adverse for Nigeria’s balance of payments and the country’s net international FDI position. Nonetheless, Nigeria’s balance of payments deficit is projected to recover to a surplus from 2022 onwards, which is projected to deteriorate growth of gross official reserves in the medium-term.