Feb 10, 2020

Presidential economic council recognizes weak economic growth, as stress mounts on external reserves

President Muhammadu Buhari’s Economic Advisory Council (EAC) met this week with the president to confirm that the country does not produce sufficient growth. The eight-member group was set up to advise the president on economic matters through quarterly meetings, but the president ordered the Council to meet every six weeks instead to bring economic matters in front of the president’s agenda. The Council raised concerns that the rate of the growth of the economy is slower than the rate the country’s population is growing; and urged the strengthening of the national statistical agencies; reforming procurement processes; and improving education, among other items to focus.

Meanwhile, Nigeria’s external reserves continued to dwindle for the seventh month and are expected to drop below to $37.5 billion by the end of this month. In January 2020, the reserves dropped to their lowest level since October 2017 (24-months), falling further by 1.4%, equivalent to $539 million to $38.056 billion. The fall in the reserves was due to a decline in dollar inflows from Foreign Portfolio Investors (FPIs), and increased dollar sales by the Central Bank of Nigeria, to protect the value of the local currency, the naira.

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