Nigerian Minister of Finance and Coordinating Minister of the Economy, Wale Edun, has, announced that the federal government has used a portion of the Nigerian Treasury Bills (NTBs) and Bonds issued in 2024 to settle Ways and Means advances from the Central Bank of Nigeria (CBN) to the tune of N4.83 trillion.
He made this clarification during a presentation at the Lagos Business School Breakfast Club in a paper he delivered, titled “Reconstructing the Economy for Growth, Investment, and Climate Resilience Development.“
Last year, the National Assembly approved the government to securitize the outstanding debit balance of N7.3 trillion of the Ways and Means Advance in the Consolidated Revenue Fund (CRF) of the federal government.
Tthe CBN Governor, Olayemi Cardoso, earlier announced that the apex bank would not grant any more Ways and Means advances to the government until the outstanding balance is cleared.
Edun said the issue of NTB and bonds was part of the government’s strategy to augment the supply of ‘sticky’ foreign capital into the economy. He said that the pricing of the securities was designed to stimulate US Dollar inflow into the country although at a higher cost to the government.
In addition to settling a portion of the Ways and Means Advances, other things the government has done to improve foreign exchange supply include the repatriation of foreign-denominated assets into the formal financial sector and the forthcoming issuance of government bonds denominated in foreign currency to improve forex inflows, expected to start early Q2 2024.
The improved forex inflow has cooled off pressure on the Naira and improved its exchange rate, which now at the parallel market is exchanging at about N1,200 to the USD.
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