Exchange Rate Target of ₦1,500 to the Dollar
President Bola Tinubu, on Wednesday, presented Nigeria’s 2025 budget, setting a bold target of stabilizing the exchange rate at ₦1,500 per dollar. This projection is part of the administration’s strategy to ensure smooth implementation of the ₦49.7 trillion “Restoration Budget,” announced during a joint session of the National Assembly in Abuja.
Tinubu highlighted that achieving this target would require reducing reliance on imports and boosting foreign exchange inflows. The proposed rate marks a ₦200 improvement from the current market rate of ₦1,700 per dollar.
Inflation Reduction Among Key Goals
The budget also projects a significant drop in inflation, aiming to reduce it from 34.6% to 15% by the end of 2025. Tinubu attributed this optimistic forecast to anticipated gains in agricultural output and refined petroleum exports. “A bumper harvest driven by enhanced security will ease food prices, while reduced petroleum imports will stabilize the market,” he stated.
Increased Oil Production as a Foundation
The government’s economic projections hinge on a crude oil production target of 2.06 million barrels per day. Tinubu assured lawmakers that measures to cut upstream oil and gas production costs would enhance Nigeria’s competitive edge in the global energy market. “Our output and exports will grow, strengthening our revenue base and fostering economic resilience,” he said.
Skepticism Over Projections
Despite the ambitious targets, analysts remain cautious. Critics argue that volatile global oil prices and ongoing insecurity could derail these projections. They also express concerns over the feasibility of stabilizing the exchange rate without substantial improvements in local production and export diversification.
“Setting targets is one thing; implementing measures to achieve them is another. Nigeria’s fiscal and monetary policies must align to avoid setbacks,” said a financial expert.
Reforms to Boost Investor Confidence
To attract foreign portfolio investments and stabilize the naira, Tinubu’s administration plans to implement structural reforms. These include reducing bottlenecks in the oil sector and improving business conditions for foreign investors. “The reforms will create a predictable and stable economic environment, fostering growth and reducing reliance on debt,” the president explained.
Economic Reboot or Overreach?
Tinubu’s 2025 budget underscores his administration’s determination to address Nigeria’s economic challenges head-on. However, achieving these goals will require meticulous execution and unwavering political will. While Nigerians await the impact of these measures, questions remain about their practicality amid persistent economic and security concerns.
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