During the 136th NEC meeting held at the Aso Rock Presidential Villa, Abuja, on Thursday, the National Economic Council confirmed that the $3 billion emergency loan-for-crude oil, secured by the Federal Government in August, would be utilized to stabilize the fluctuating value of the naira.
The currency’s volatility has been evident in the Investors & Exporters’ window and worsened in the parallel market, where it reached N1000/$ earlier this month.
Speaking to State House correspondents, Nasarawa State Governor Abdullahi Sule expressed confidence in the plan, stating, “So, we are very confident and we still believe very strongly that with the plan that will come out and with all these items that have been listed on the improvement of revenue, the $3 billion shall be useful to us down the line.
On August 16, the Nigerian National Petroleum Company Limited announced securing an emergency $3 billion crude repayment loan from Afrexim Bank.
This loan was intended to alleviate pressure on the naira by enabling the settlement of taxes and royalties in advance, providing the Federal Government with essential dollar liquidity for naira stabilization with limited risk.
However, the naira’s fluctuations persisted in the I&E window and worsened in the parallel market, reaching N1000/$ the week before last. It exhibited a recovery on Friday, September 22, 2023, following President Bola Tinubu’s nomination of Olayemi Cardoso as CBN governor. In response, the naira gained N10 against the dollar in the black market, closing at N990/$1.
Regarding the timeline for the intervention and the possibility of a supplementary budget, Governor Sule clarified, “The $3 billion that was taken is meant to stabilize the naira. As you have seen, we have a new team at the CBN, and the new team needs some time to work out the details.
Taking the loan is one thing; planning the process of stabilization is another because it will take some time.
The CBN governor was confirmed only a few days ago, and he has just begun rolling out his plans.
Regarding the need for a supplementary budget, Governor Sule added, “A supplementary budget is a request that will arise based on the current developments.
At this moment, I’m not sure there is an immediate need for a supplementary budget. So far, no requests for supplementary budgets have been presented to NEC.
