In a significant development for Nigeria’s economic landscape, the International Monetary Fund (IMF) has reported a notable surplus in the country’s current account balance.
According to the latest data from the ‘World Economic Outlook Database,’ Nigeria’s current account has seen a substantial increase, reaching a surplus of $1.432 billion in 2024.
This marks a considerable improvement from the $1.21 billion surplus recorded in the previous year, highlighting positive momentum in the nation’s financial standing.
The surge in the current account balance is largely attributed to Nigeria’s growing gross national savings and increased investment activities.
The report reveals that in 2024, Nigeria’s gross national savings surged to 26.32 percent of Gross Domestic Product (GDP), up from 24.61 percent in 2023.
Concurrently, total investment also experienced a notable uptick, reaching 25.75 percent of GDP in 2024, compared to 24.28 percent in the preceding year.
A country’s current account balance serves as a comprehensive indicator of its international economic transactions, encompassing trade balance, net income, direct transfers, and asset income.
A positive balance signifies a net lending position, indicating economic strength and stability.
The IMF data underscores a positive outlook for Nigeria’s economic growth, fueled by increasing investment and savings rates. This trajectory bodes well for the country’s overall economic stability and prosperity, signaling encouraging prospects for the country.
However, amidst these positive economic indicators, Nigeria continues to grapple with the aftermath of President Bola Tinubu’s decision to remove subsidies in May 2023. The removal has led to significant increases in electricity tariffs, food prices, transportation costs, house rents, and inflation rates.
In response to the economic challenges, the Nigerian Labour Congress (NLC) and the Trade Union Congress (TUC) have declared a nationwide industrial strike, advocating for a substantial increase in the minimum wage.
The unions are pressing for a living wage of N494,000 monthly, surpassing the current N30,000 stipulated by the Federal Government.
Amid the relaxed labor unrest, the government has expressed willingness to negotiate, indicating a potential upward adjustment in the proposed minimum wage.
Nigeria’s current inflation rate stands at a concerning 33.69 percent, according to data from the National Bureau of Statistics (NBS), underscoring the urgency of addressing economic challenges while leveraging the positive momentum highlighted in the IMF report.