Olayemi Cardoso, Governor of the Central Bank of Nigeria (CBN), has said that the country will soon be free of its $7 billion foreign exchange (FX) backlog, with $2.3 billion already paid to foreign airlines and other sectors.
According to TheCable, Cardoso spoke during a Monday interview on Arise TV.
On September 26, 2023, the CBN governor stated that the apex bank was working to settle its $7 billion FX backlog liabilities.
The apex bank, which began clearing the debt in November 2023, recently released $500 million to various sectors to address the backlog of verified foreign exchange transactions.
On January 30, 2024, the CBN announced that it had completed the payment of all verified FX claims by airlines, with an additional disbursement of $64.44 million to the relevant foreign aviation firms.
Cardoso provided updates on the backlog liabilities, stating that his leadership inherited the $7 billion debt and that the central bank discovered that $2.4 billion of the total was invalid following an investigation into the transactions.
He assured Nigerians that the FX backlog would be resolved soon, with only approximately $2.2 billion remaining unpaid.
Cardoso said:
“When we came into the leadership of the Central Bank a few months ago, the issue of foreign exchange backlog was something that we met — obviously for something that had been accumulated over some time. It is very important as a sovereign nation to be able to keep your integrity intact, and as a bank, to be able to show that we consider obligations as obligations that must be met.”
“Now, approximately $7 billion was what we were told, and we looked at these and commenced the process of starting to pay.“We were settling some which we believed were valid and due for payment, and this isn’t something we could just do in one shot or take a bit of time,” he said.
“Now, as we went along, we had reasons to believe that we needed to take a harder look at these obligations. So, we contracted Deloitte Management Consultants, to do a forensic of all these obligations and to tell us what was valid and what was not.
“We were committed to ensuring that we would pay all valid transactions and the result that came out of this was startling.
“We discovered that of the $7 billion, roughly about $2.4 billion had issues and had no business being there, and the infractions on that range from so many things, for example, not having valid important documents, and in some cases, even entities that did not exist, and in some cases, beneficiaries, account parties who had asked for exchange and got more than they asked for and some who didn’t even ask for any, got.
“Well, we’re not paying, if you don’t qualify. They are not valid.
“We have settled about $2.3 billion and that applies to the airlines and a whole load of different entities spread throughout the economy.”
Cardoso said what remains is about $2.2 billion. He added that he is confident that the CBN will shortly be addressing those and be able to move on and make progress.