Nigeria’s foreign (external) reserve rose in the immediate past month of October, recording a boost of $5,037,825,197 as at 29th October 2021. The foreign reserve figures officially passed the $40 billion mark on October 18, 2021.

Within a month, the external reserve gained almost 13%, bringing the figures to $41.8 billion, up from $36.7 billion recorded on 30th September 2021.

At the time of writing this article, however, Nigeria’s external reserve had witnessed marginal declines with its position standing at 41.79 billion.

Why the surge?

Analysts attribute the increase in foreign reserve to Nigeria’s debt appetite, particularly from the federal government’s $4 billion Eurobond issued on the international debt market.

The International Monetary Fund approved $3.35 billion in direct allocations, another source of the boost to the nation’s reserves. In addition, China’s $1.5 billion also provided a solid foundation for the increase.

Nigeria’s foreign reserves  growth could also be attributed to the global crude oil market’s bullish run. Bonny Light crude from Nigeria was trading at $81.85 a barrel at the time of writing this piece. Because crude oil exports account for more than 85% of Nigeria’s overall export revenue, Nigeria’s foreign reserves and crude oil prices are inextricably linked.

With OPEC+ likely to meet on November 4th, the market remains bullish, as the output cut is expected to continue to support a steady rise in oil prices.

External rate position

Naira at the official Investors and Exporters window appreciated against the US dollar to close at N414.8/$1 on Wednesday 3rd November 2021, representing a 0.07% gain compared to N415.07/$1 recorded at the close of trading activities on Tuesday.

However, the Naria continues to have difficulties in the black market, on Wednesday the Naira closed at N570/$1. This disparity between the official and black market continues to be a source of concern.


Despite a $5.04 billion increase in Nigeria’s foreign reserves, many analysts doubt the CBN’s ability to keep up with the pace of growth, given the country’s rising debt profile.

As a result, long-term sources such as overseas deposits and holding other government assets should be considered as options for organically increasing the reserve.