Nigeria’s current account balance has risen to $1.432 billion in 2024, despite the economic downturn impacting the country, according to the International Monetary Fund’s World Economic Outlook. The IMF data suggests a positive outlook for Nigeria’s economic growth and stability, reflecting a growing economy with increasing investment and savings, even amid eroding investor confidence.
Nigeria’s trade balance for the reviewed period shows a significant increase from the $1.21 billion surplus recorded in 2023. A country’s current account balance measures its net trade in goods, services, and transfers with the rest of the world, including imports and exports, income from investments abroad, and remittances. A positive balance indicates a surplus, while a negative balance indicates a deficit.
In 2024, Nigeria’s gross national savings rose to 26.32 percent of Gross Domestic Product (GDP), up from 24.61 percent in 2023. The country’s total investment also increased to 25.75 percent of GDP in 2024, compared to 24.28 percent in 2023.
The rise in Nigeria’s current trade balance is largely due to growing national savings and investment, even as the economy faces a dollar liquidity shortage. This report comes at a time when multinationals are exiting the country, citing a frail economic environment and further reducing the needed foreign direct investment.
Additionally, Nigeria, once the largest economy in Africa, has slipped to the fourth position as its GDP declines and investor confidence wanes. The country is also grappling with an exchange rate crisis, record-high inflation, and declining external reserves, yet it has recorded a surplus in its current account balance.
Analysts and economists consider a growing current account balance a positive indicator of economic strength. However, they note that policymakers must ensure its sustainability to avoid imbalances or distortions in the economy.
“A growing current account surplus can be a sign of economic strength, indicating that the country’s industries are competitive internationally and that its exports are in demand,” said Ibrahim Bakare, a professor of Economics. “It may also lead to an appreciation of the country’s currency, as increased demand for its goods and services boosts the value of its currency relative to others,” he added.
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