Overseas buyers welcomed Nigeria’s current macroeconomic reforms however flagged persistent issues about oil value volatility, capital repatriation dangers, and excessive transaction prices throughout a personal investor discussion board hosted by the Central Bank of Nigeria (CBN) on the Nasdaq MarketSite in New York on April 17, 2025.
The occasion, themed “The Nigeria Funding Agenda: Pathways for Progress & International Partnerships,” was held in collaboration with NGX Group, J.P. Morgan and AVCA.
It attracted representatives from high world monetary establishments, together with Citi, JPMorgan Chase, Commonplace Chartered, and Jadara Capital Companions.
Though the CBN’s reform agenda was broadly acknowledged as a step in the fitting route, overseas buyers made it clear that sustained investor confidence will depend upon Nigeria’s skill to handle key structural and exterior dangers, particularly oil market volatility.
Traders welcomed reforms however flagged oil dangers
Joyce Chang, Chair of International Analysis at JPMorgan Chase, recommended Nigeria for making progress on long-standing structural points, together with the removing of gasoline subsidies and FX liberalisation.
Nonetheless, she famous that the worldwide atmosphere had modified considerably, citing U.S. tariff hikes and a better threat of recession.
“We’re now coping with a possible 3% of GDP tax impact from current U.S. tariffs,” Chang stated. “Nigeria has made strides, however oil value volatility stays a key threat.”
JPMorgan now locations the chance of a U.S. recession at 60%, up from 40% earlier than the brand new tariffs had been introduced.
Oil costs, a key supply of Nigerian income, are anticipated to fall into the $50s vary by 2026. This dynamic, Chang stated, introduces macroeconomic fragility that buyers should value in.
Traders name for Nigeria to maneuver past oil
For some buyers, nevertheless, the concentrate on oil value dangers could also be shedding relevance. Razia Khan, Chief Economist for Africa and the Center East at Commonplace Chartered, argued that Nigeria’s current reforms—particularly round FX—have created a platform for lowered dependence on oil.
“Nigeria is lastly at a degree the place it would be capable to break away from the oil cycle,” Khan stated. “We now have a extra aggressive alternate fee and a construction that might assist actual wealth creation exterior oil.”
She added that investor issues about repatriation and macro stability are being addressed by FX reform and financial tightening, however urged policymakers to remain the course.
“Structural reforms take time. Nigeria is simply simply in the beginning of a reputable path towards diversification,” she stated.
FX reforms enhance sentiment, however doubts stay
Jason Rekate, International Co-Head of Company Banking at Citi, stated investor curiosity in Nigeria is rising sharply in comparison with current years, pushed primarily by FX reforms that now permit capital inflows and outflows with larger transparency.
“It’s a distinct dialog now. Nigeria is now not on the ‘penalty field’ record,” Rekate stated. “Purchasers are asking how quickly they will enter, not if.”
Regardless of this shift, Rekate famous that world sentiment remains to be fragile and that oil stays a “transmission channel” for exterior shocks into the Nigerian financial system.
A world recession, he warned, would renew strain on the naira and take a look at the sturdiness of Nigeria’s new FX regime.
Requires stronger market construction and regulatory readability
Ahmad Zuaiter, Co-Founder and CIO of Jadara Capital Companions, additionally welcomed Nigeria’s reform momentum however harassed that important frictions stay in its capital markets.
“Two years in the past, just about no portfolio buyers had been energetic in Nigeria resulting from capital controls,” he stated. “At this time, that has modified, however prices stay prohibitive.”
Zuaiter cited common transaction prices of two–3% for listed equities in Nigeria, in comparison with 10–15 foundation factors in Saudi Arabia or Egypt. He attributed a lot of this to regulatory inefficiencies and levies akin to stamp duties.
He additionally urged Nigerian regulators to offer firmer assurances on market stability. “Capital controls, FX restrictions, and circuit breakers on shares have been used too typically previously. Traders want credible alerts that these days are over,” he stated.
Nigeria’s long-term outlook nonetheless attracts optimism
Regardless of short-term issues, panellists agreed that Nigeria’s demographics, useful resource base, and reform momentum make it one of many extra engaging frontier markets for long-term buyers.
Commonplace Chartered’s Khan referenced the nation’s rising inhabitants and up to date census train as indicators of future shopper market scale.
“Nigeria may turn into the third most populous nation by 2050,” she stated. “Overseas buyers haven’t absolutely positioned for that progress.”
Joyce Chang bolstered the view that Nigeria is changing into extra mainstream in rising market funding discussions.
“We had Nigeria as a high advice for 18 months,” she stated. “Whereas near-term warning persists resulting from oil, Nigeria’s structural shift is being seen.”
Key investor asks the CBN
All through the discussion board, overseas buyers had been clear about what they wanted from Nigeria to unlock additional inflows:
- Sustained FX coverage consistency with out arbitrary restrictions or market shutdowns.
- Discount in transaction prices and regulatory friction in capital markets.
- Clearer coverage route on non-oil income reforms, together with VAT and taxation.
- Improved ease of doing enterprise, notably for bodily entry, infrastructure, and journey.
- Dedication to transparency in financial and monetary coverage communication.
What you need to know
Nigeria’s overseas alternate reform efforts started in June 2023 following the inauguration of President Bola Tinubu.
The Central Bank of Nigeria (CBN) moved to unify the a number of alternate fee home windows, transitioning towards a extra market-reflective system. This included the removing of restrictions on FX transactions, permitting demand and provide dynamics to play a larger function in fee willpower.
For the reason that reforms, the naira has skilled important volatility however started to stabilize in early 2025 following a collection of financial tightening measures and improved FX market transparency. For many of Q1 2025, the alternate fee held regular, with improved investor sentiment and better FX inflows by formal channels.
Nonetheless, in April 2025, the naira got here below renewed strain, largely pushed by world uncertainty tied to former U.S. President Donald Trump’s tariff bulletins. The tariffs led to a broader risk-off sentiment in rising markets and a decline in oil costs, Nigeria’s main export income supply.
In response, the CBN intervened within the FX market, injecting liquidity to assist the naira. It additionally supplied up to date steering on Nigeria’s exterior reserves, stating that internet reserves at the moment stand at $23 billion.
These developments fashioned the backdrop of the CBN’s funding roadshow in New York, the place world buyers sought readability on the sustainability of Nigeria’s FX framework and its broader macroeconomic route.
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