CENTRAL BANK OF NIGERIA
Half Year Economic Report, 2022

Half Year
Economic Report


i

CENTRAL BANK OF NIGERIA
Half Year Economic Report, 2022
This document is for CBN internal consumption

Central Bank of Nigeria


2022 Half Year Economic Report


CENTRAL BANK OF NIGERIA
Half Year Economic Report, 2022


Central
Bank
of
Nigeria
Corporate Head Office
Plot 33, Abubakar Tafawa
Balewa Way Central Business
District, Cadastral Zone
P.M.B. 0187
Garki, Abuja
Website: www.cbn.gov.ng

Contact Centre
Tel: +234 (0) 700 225 5226
©2022 Central Bank of Nigeria
ISSN 1597-2976


iii


CENTRAL BANK OF NIGERIA
Half Year Economic Report, 2022

ABOUT THE REPORT

The Central Bank of Nigeria (CBN) Economic Report presents economic developments
in Nigeria, intended for dissemination to the public. The Report provides insights on
current developments in the real, fiscal, financial, and external sectors of the Nigerian
economy, as well as on global issues of interest. It also reflects the policy initiatives
of the CBN in pursuit of its mandate. The Report is targeted at a wide range of readers,
including economists, policymakers, financial analysts in the government and private
sectors, and the public. Free copies of the Report, both current and past issues, can
be obtained from the CBN website: www.cbn.gov.ng. All inquiries concerning the
report should be directed to the Director, Research Department, Central Bank of
Nigeria, P.M.B. 187, Garki, Abuja, Nigeria.


iv


CENTRAL BANK OF NIGERIA
Half Year Economic Report, 2022
GOVERNANCE FRAMEWORK


Members of the Monetary Policy Committee (MPC) as of 30 June 2022

Godwin I. Emefiele, CON

Governor (Chairman)

Aishah N. Ahmad

Deputy Governor (Financial System Stability)

Edward L. Adamu

Deputy Governor (Corporate Services)

Folashodun A. Shonubi

Deputy Governor (Operations)

Kingsley I. Obiora

Deputy Governor (Economic Policy)

Mike I. Obadan

Member

Adeola F. Adenikinju

Member

Robert C. Asogwa

Member

Aliyu R. Sanusi

Member

Ahmed Aliyu

Member

Momodu Omamegbe

Member

Mohammed A. Salisu

Member

Hassan Mahmud

Secretary


Members of the Committee of Governors
1 Godwin I. Emefiele, CON
- Governor (Chairman)
2 Aishah N. Ahmad
- Deputy Governor (Financial System Stability)
3 Edward L. Adamu
- Deputy Governor (Corporate Services)
4 Folashodun A. Shonubi
- Deputy Governor (Operations)
5 Kingsley I. Obiora
- Deputy Governor (Economic Policy)

Alice Karau
- Secretary to the Board


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CENTRAL BANK OF NIGERIA
Half Year Economic Report, 2022


List of Departmental Directors as of 30 June 2022

Samuel C. Okojere
-
Banking Services

Haruna B. Mustafa
-
Banking Supervision

Elizabeth O. Fasoranti

-
Branch Operations

Muhammad A. Abba
-
Capacity Development

Rashida J. Monguno

-
Consumer Protection

Osita C. Nwanisobi
-
Corporate Communication

Alice Karau

-
Corporate Secretariat

Ahmed B. Umar
-
Currency Operations

Philip Y. Yusuf
-
Development Finance

Benjamin A. Fakunle
-
Finance

Angela A. Sere-Ejembi
-
Financial Markets

Chibuzo A. Efobi
-
Financial Policy and Regulation

Joseph G. Omayuku
-
Governors

Amina A. Habib
-
Human Resources

Rakiya S. Mohammed
-
Information Technology

Lydia I. Alfa
-
Internal Audit

Sirajuddin K. Salam-Alada
-
Legal Services

Abdulkadir A. Jibril

-
Medical Services

Hassan Mahmud
-
Monetary Policy

Nkiru E. Asiegbu
-
Other Financial Institutions Supervision

Musa I. Jimoh
-
Payments System Management

Arinze A. Stanley
-
Procurement and Support Services

Michael A. Adebiyi
-
Research

Benjamin C. Nnadi
-
Reserve Management

Blaise Ijebor
-
Risk Management

Oluwakemi O. Osa-Odigie
-
Security Services

Mohammed M. Tumala
-
Statistics

Clement O. Buari
-
Strategy Management

Ozoemena S. Nnaji
-
Trade and Exchange

Olorunsola E. Olowofeso
-
West African Monetary Institute

Abubakar A. Kure
-
NIRSAL Microfinance Bank


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CENTRAL BANK OF NIGERIA
Half Year Economic Report, 2022


List of Branch Controllers/Currency Officers as at 30 June 2022

Christopher O. Adayi
-
Abakaliki

Wahab Oseni
-
Abeokuta

Ogbu, O. Michael
-
Abuja

Wasiu A. Omotoso
-
Ado-Ekiti

Fatai A. Yusuf
-
Akure

Okafor G. Ikechukwu
-
Asaba

Benedicth I.C. Maduagwu.
-
Awka

Haladu A. Idris
-
Bauchi

Renner D. Jumbo
-
Benin

Mannir D. Abdullahi
-
Birnin-Kebbi

Glory U. Iniunam
-
Calabar

Gana A. Abdulkadir
-
Damaturu

Sa'adatu A. Ibrahim
-
Dutse

Chidozie E. Okonjo
-
Enugu

Shehu A. Goringo
-
Gombe

Umar B. Ibrahim
-
Gusau

Olufolake M. Ogundero
-
Ibadan

Najimu L. Oluwale
-
Ilorin

Idirisa D. Maina
-
Jalingo

Esther T. Catherine
-
Jos

Yusuf W. Baba
-
Kaduna

Babangida, Jino
-
Kano

Musa Ahmed. Ladan
-
Katsina

Samson Isuwa
-
Lafia

Bariboloka K. Godfrey
-
Lagos

Ahmed I. Sule
-
Lokoja

Tijani K. Lawan
-
Maiduguri

John O. Itaha
-
Makurdi

Saheed M. Ademola
-
Minna

Ajuma D. Madojemu
-
Osogbo

Oruwari Oyoburuoma
-
Owerri

Okeke Chuks
-
Port Harcourt

Dahiru U. Nakazalle
-
Sokoto

Ayotunde O. Oladimeji
-
Umuahia

Itohan M. Ogbomon-Paul
-
Uyo

Francis E. Asuquo
-
Yenagoa

Sanusi S. Nyashi
-
Yola


vii

CENTRAL BANK OF NIGERIA
Half Year Economic Report, 2022


CONTENTS


ABOUT THE REPORT
iii


GOVERNANCE FRAMEWORK

iv


Members of the Committee of
Governors


iv


Members of the Monetary
Policy Committee (MPC)


iv


List of Departmental Directors


v


List of Branch
Controllers/Currency Officers

vi


EXECUTIVE SUMMARY

ix


SERVING THE NIGERIAN PEOPLE


DELIVERING ON
THE CBN’s
MANDATE

THE GLOBAL
ECONOMY


•
The CBN’s Mandate
and Strategy

•
CBN
Strategic
Priorities

•
Output Growth

•
Inflation

•
Financial
Markets

•
Commodity
Prices

•
Central Banks’
Response

•
Fiscal Measures

viii


CENTRAL BANK OF NIGERIA
Half Year Economic Report, 2022


MACROECONOMIC PERFORMANCE

OUTLOOK

ADDITIONAL
INFORMATION


•
Monetary Policy

•
Global
Economic
outlook

•
Regional
Meetings
•
NonRegional
Meetings

•
The Real Economy

•
Domestic
Economic
outlook

•
Fiscal Developments

•
Financial Developments

•
Payments System
Management

•
External Sector
Development

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CENTRAL BANK OF NIGERIA
Half Year Economic Report, 2022

EXECUTIVE SUMMARY
The Global Economy
Global economic activity decelerated in the
first half of 2022 due to supply-chain
disruptions and heightened inflationary
pressures, occasioned by rising energy and
commodity prices due to the Russia-Ukraine
war and COVID-19 containment measures.
Thus, the global Composite Purchasing
Managers’ Index (PMI) fell to 52.30 index
points in the first half of 2022, from 54.30
index points recorded in the second half of
2021, reflecting a slower pace of expansion.
The development mirrored the IMF’s revised
growth forecast of 3.2 per cent for 2022,
down from the 6.1 per cent growth for 2021.
The Real Economy
Domestic economic recovery continued in the
first half of the year, despite global
headwinds. The sustained growth in the
domestic economy was realised on the heels
of the full return to normalcy after the
removal of the COVID-19 induced restrictions
and the sustained implementation of the
various economic stimulus packages by the
fiscal and monetary authorities. Real GDP
growth rose by 3.32 per cent in the first half
of 2022, compared with 4.01 per cent and
2.70 per cent in the preceding half and the
corresponding half of 2021, respectively.

Inflationary pressures surged in the first half
of 2022, reversing the decline that started in
the first half of 2021. Headline inflation rose
to 18.60 per cent, from 15.63 per cent and
17.75 per cent in the preceding half and
corresponding half of 2021, respectively. The
rise in inflation was driven, mainly by increase
in food and energy (diesel and gas) prices,
persisting structural bottlenecks and security
challenges in some parts of the country. The
elevated inflationary pressures during the
period, necessitated a tightening of monetary
policy by the Bank.
Domestic crude oil production in the first half
of 2022 dropped, owing, largely, to the rise in
cases of crude oil theft and pipeline
vandalism. At an average daily production of
1.36 million barrels per day (mbpd) or 246.2
million barrels in the first half of 2022, crude
oil output during the period declined by 6.8
per cent, compared with the corresponding
half of 2021. Crude oil prices surged in the
review period due to heightened concerns
about the future availability of crude oil in the
global market, following sanctions imposed
on Russian crude supply by the US, and the
EU’s decision to ban 90.0 per cent of Russian
crude oil by the end of 2022. Accordingly, the
average spot price of Nigeria’s reference
crude oil, the Bonny Light, rose by 71.2 per
cent to US$110.96 per barrel (pb) from
US$64.82 pb in the corresponding half of
2021.


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CENTRAL BANK OF NIGERIA
Half Year Economic Report, 2022
The Bank sustained its development finance
interventions in critical sectors of the
economy to improve access to credit, support
job creation and sustain economic recovery.
Fiscal Developments
Federation revenue in the first half of 2022
declined owing to the high cost of value
shortfall recovery on premium motor spirit
(PMS) and low domestic crude oil production,
despite the high global crude oil prices,
caused
by
the
Russia-Ukraine
war.
Accordingly, at N5,479.10 billion (or 6.0 per
cent of GDP), federally collected revenue fell
by 4.2 per cent and 40.4 per cent relative to
the level in the second half of 2021 and the
budget benchmark, respectively.
Notwithstanding the rise in oil prices and the
uncertainty surrounding global supply, oil
revenue in the first half of 2022, at N2,095.34
billion (2.3 per cent of GDP), declined, relative
to the level in the corresponding period in
2021 and the projection for 2022, and
constituted 38.2 per cent of total revenue.
This was attributed to high value shortfall
recovery payment and low domestic crude oil
production, occasioned by crude oil theft and
pipeline
vandalism.
However,
non-oil
revenue, which accounted for the balance of
61.8 per cent of total revenue, at N3,383.76
billion (3.7 per cent of GDP), improved,
relative to the first half of 2021. The
performance was due to the rise in collection
of company income tax (CIT), customs and
excise duties and value added tax (VAT).
Despite the leap in non-oil receipts, it fell
below the proportionate target by 23.9 per
cent.
Public debt rose during the period following
new
borrowing,
mainly,
to
finance
infrastructure projects and legacy liabilities.
Total public debt outstanding, at end-June
2022,
stood
at
N42,845.88
billion,
representing 20.8 per cent above the level at
end-June 2021. The total public debt-to-GDP
ratio of 23.7 per cent, remained below the
thresholds set by the 2020-2023 MTDS (40.0
per cent), WB/IMF (55.0 per cent) and
ECOWAS (70.0 per cent).
Financial Developments
Nigeria’s financial sector remained safe and
sound in the first half of 2022. Financial
soundness indicators moderated during the
period, reflecting uncertainties in the global
and domestic economies. However, they were
still within regulatory thresholds. The Banking
industry stress test revealed that the solvency
and liquidity positions remained resilient
under “mild” to “moderate” scenarios of
sustained economic and financial conditions
but
were
vulnerable
under
“severe”
scenarios. The economy witnessed steady
growth, on the back of the continued
accommodative monetary policy stance of
the CBN, which eased credit conditions in the
economy. However, the Bank switched to a
hawkish policy stance to tame heightened
inflationary and foreign exchange pressures
that persisted in the later part of the halfyear. Growth in monetary aggregates was
generally above indicative targets for 2022.


xi


CENTRAL BANK OF NIGERIA
Half Year Economic Report, 2022
Broad money supply M3 surged by 10.0 per
cent to N48,890.24 billion at end-June 2022,
owing to increase in net domestic assets
(NDA), compared with 1.6 per cent growth at
end-June 2021.
Liquidity conditions in the banking system
were influenced by fiscal operations of
government, Cash Reserve Requirement
(CRR) operations, transactions in the foreign
exchange market, maturity and issuance of
CBN bills and government securities. These
factors dictated the movement in money
market rates, which trended downward in the
review period. The weighted average monthly
inter-bank call rate, declined to 9.4 per cent,
compared with 10.5 per cent in the second
half of 2021, following improved liquidity in
the banking system.
Activities on the Nigerian equities market
were bullish, despite volatile global market
fundamentals arising from the RussiaUkraine war. The NGX All-Share Index and
aggregate
market
capitalisation
rose,
relative to their levels at end-December 2021
and end-June 2021. The improved market
performance was due to bargain hunting,
following the release of positive first quarter
of 2022 corporate earnings results.
The Bank sustained its efforts at improving
the safety, reliability, and efficiency of the
payments system and attainment of a digital
financial inclusion system through the
continued implementation of the Payments
System Vision 2025 Strategy Plan, during the
review period.

External Sector Developments
The
external
sector
experienced
an
unprecedented shock, following the RussiaUkraine war, which resulted in supply-chain
disruptions with the attendant hike in the
prices of energy, food and other commodities.
Consequently, the performance of the
external account weakened in the review
period, with an estimated overall balance of
payments deficit of 0.3 per cent of GDP,
compared with a surplus of 1.7 per cent of
GDP in the second half of 2021. However, the
deficit recorded was an improvement,
compared with the deficit of 1.7 per cent of
GDP in the first half of 2021. A current
account surplus of 3.5 per cent of GDP was
recorded in the review period, relative to the
corresponding period of 2021, driven by
higher export earnings from rising crude oil
prices. The financial account maintained a
net borrowing position with a net incurrence
of financial liabilities of 1.0 per cent of GDP,
compared with 1.2 per cent of GDP in the
preceding period. Increased inflow of other
investment liabilities resulted in a higher net
liability position in Nigeria's International
Investment Position (IIP).

The external reserves position at the end of
June 2022 was US$39.16 billion, compared
with US$32.99 billion at end-June 2021. This


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CENTRAL BANK OF NIGERIA
Half Year Economic Report, 2022
could finance 8.9 months of import (goods
only) or 6.7 months of import (goods and
services), above the international benchmark
of 3.0 months. The stock of external debt
increased to US$40.06 billion, from US$38.39
billion at end-December 2021 and US$33.47
billion at end-June 2021, following additional
disbursements from multilateral and bilateral
sources, as well as the issuance of Eurobonds.
The pressure in the foreign exchange market
persisted, owing largely to a supply shortage.
This led to the depreciation of the naira in the
review period. The exchange rate of the naira
to the US dollar at the I&E window, closed at
N414.00/US$, at the end of June 2022,
relative to N413.00/US$ at the end of
December 2021 and N411.50/US$ at the end
of June 2021.

Outlook
The global economic outlook for the second
half of 2022 remains cautiously optimistic, on
account of the tightening financial conditions
across various economies to tame rising
global inflation, China's slowdown due to
resurgence of the COVID-19 pandemic and
the negative spillovers of the Russia-Ukraine
war. Domestic outlook is positive, as output
growth is expected to maintain its upward
trajectory for the rest of the year. The
optimism is predicated on continued policy
support, positive impact of sustained CBN
intervention on growth-enhancing sectors,
effective
implementation of the

National Budget and the Medium-Term
National Development Plan (MTNDP), and
the increase in crude oil prices.
The external sector performance is expected
to remain viable, as surplus trade balance is
maintained in the short-to-medium term.
With global crude oil prices remaining stable
above US$100pb in the second half of 2022,
accretion to external reserves is expected to
improve. However, the Bank’s continued
intervention in the foreign exchange market,
rising import bills, and increased external
debt-servicing, would limit accretion to
reserves.

Fiscal sector is expected to remain positive in
the second half of the year, predicated on the
effective implementation of the Finance Act
2021, under the Strategic Revenue Growth
Initiatives (SRGIs) of the FGN, with its taxreforms, expected to boost non-oil revenue.
Furthermore, the imposition of new EU
sanctions on Russia would continue to rally oil
prices,
thereby
boosting
oil
earnings.
However, constraints to crude oil production,
elevated public debt, coupled with lingering
insecurity challenges could pose downside
risks to the realisation of set goals in the 2022
fiscal year.

The financial sector is expected to remain
resilient in the second half of the year,
reflecting CBN’s effort in continuously
monitoring the potential risks alongside
periodic stress tests, to assess the safety and


xiii


CENTRAL BANK OF NIGERIA
Half Year Economic Report, 2022
health of the banking sector. Also, mandatory
provisioning would mitigate the risk of
deterioration in the quality of restructured
loans.

CENTRAL BANK OF NIGERIA
Half Year Economic Report, 2022


•To be a people-focused Central
Bank promoting confidence in
the economy and enabling an
improved standard of living.
Vision
Become the model central bank 1
Deliver price stability conducive to
economic growth 2
Achieve safe, stable, and sound financial
system 3
Deliver credible, reliable, and efficient
payments system 4
Promote sustainable finance and inclusive
economic growth 5
• To
ensure
monetary,
price
and
financial system stability as a catalyst
for inclusive growth and sustainable
economic development.
Mission
Mandate
(CBN Act 2007)
• Ensure monetary and price stability
• Issue legal tender currency in Nigeria
• Maintain external reserves to safeguard
the international value of the legal
tender currency
• Promote a sound financial system in
Nigeria
• Act as Banker and provide economic and
financial advice to the Federal
Government
Established by the CBN Act 1958
(as amended)
Commenced operation 1 July 1959
THE CENTRAL
BANK OF
NIGEIRIA

CENTRAL BANK OF NIGERIA
Half Year Economic Report, 2022


CBN Strategic Priorities (2019 – 2024): 5-Point Agenda
Foster the Development of a Robust
Payments System
Conserve the utilization of reserves
for critical raw materials and imports
that are not produced locally
Improve consumer spending and
investment by MSMEs through
affordable and adequate credit
Grow our External Reserves
Improve Access to Credit
Promote inclusive growth and
private sector investment by
leveraging on monetary tools to
maintain a low inflation
environment, while trying to seek
exchange rate stability
Preserving macroeconomic and
financial stability
Drive the cashless initiative across
the country to enhance efficiency
and propel the financial inclusion
drive
Diversify the Economy through
intervention programmes
Boost productivity growth in both
the agricultural and manufacturing
sectors through end-to-end value
chain credit intervention
programmes

CENTRAL BANK OF NIGERIA
Half Year Economic Report, 2022
Section Two


Global economic dynamics and the evolution of events shaped
domestic economies around the world.
❖ Global Output Growth
❖ Global Inflation
❖ Global Financial Markets
❖ Central Banks’ Responses
❖ Fiscal Measures

CENTRAL BANK OF NIGERIA
Half Year Economic Report, 2022
This document is for CBN internal consumption
This document is for CBN internal consumption
This document is for CBN internal consumption
This document is for CBN internal consumption
2.1 GLOBAL OUTPUT GROWTH
Global economic activity in the first half of 2022
was affected by a combination of factors,
including rising energy and commodity prices,
persisting supply chain disruptions, and the
COVID-19 containment measures in China. The
IMF, in its July 2022 World Economic Outlook
(WEO), revised the 2022 growth forecast
downward to 3.2 per cent from 3.6 per cent
growth forecast in April 2022 report. This was
due to deceleration in economic activity, driven
by supply chain disruptions and inflationary
pressures induced by the Russia-Ukraine war and
the COVID-19 containment measures in China.
The revision was corroborated by the average J.P.
Morgan Global Composite Purchasing Manager’s
Index (PMI), which fell to 52.30 index points in
the first half of 2022, from 54.30 index points in
the second half of 2021, reflecting a slower pace
of economic expansion. In addition, the
manufacturing and services PMI indices fell to
53.30 and 52.80 index points in the first half of
2022, from 54.40 and 54.80 index points in the
second half of 2021, respectively.

Table 2.1: Growth in Selected Countries
Country
Growth

2022f
2023f
Global
6.1
3.2
2.9
Advanced Economies
5.2
2.5
1.4
United States
5.7
2.3
1.0
United Kingdom
7.4
3.2
0.5
Japan
1.7
1.7
1.7
Germany
2.9
1.2
0.8
Italy
6.6
3.0
0.7
Emerging Market & Developing
Economies
6.8
3.6
3.9
Russia
4.7
-6.0
-3.5
China
8.1
3.3
4.6
India
8.7
7.4
6.1
Sub-Saharan Africa
4.6
3.8
4.0
South Africa
4.9
2.3
1.4
Nigeria
3.6
3.4
3.2
Note: 2022f and 2023f are forecasts
Source: IMF World Economic Outlook, July 2022.

CENTRAL BANK OF NIGERIA
Half Year Economic Report, 2022
This document is for CBN internal consumption
This document is for CBN internal consumption
This document is for CBN internal consumption
This document is for CBN internal consumption
Table 2.2: Global Composite PMI
2021H1
2021H2
2022H1
Composite
55.3
54.2
52.3
Manufacturing
55.0
54.4
53.3
Services (Business Activity)
55.5
54.8
52.8
Source: IHS Markit, JP Morgan, Staff Compilation

Advanced Economies


Growth in advanced economies (AEs) slowed, due
largely, to spillover effect of the Russia-Ukraine
war and the associated energy price hikes. Output
growth forecast was 2.5 per cent in 2022, below
the 5.2 per cent in 2021, reflecting a downturn in
economic activities. In the US, output growth was
expected to slow to 2.3 per cent in 2022, from 5.7
per cent in 2021, attributed to the anticipated
impact of a tighter monetary policy. Similarly, the
growth projections for Germany, Italy and the UK
were 1.2, 3.0 and 3.2 per cent, respectively,
below the levels in 2021. The slowdown in
economic activities was buttressed by the
movement in the average JP Morgan Composite
Global Purchasing Managers’ Index (PMI).
In the United States and the United Kingdom,
weak demand and supply shortages slowed the
pace of economic activity as depicted by the
decline in PMI to 54.43 and 56.67 index points in
the first half of 2022, respectively, relative to
their levels in the preceding and corresponding
halves of 2021. Similarly, prevailing geopolitical
uncertainty and rising inflationary pressures
weighed on economic activity in Germany and
Italy as PMI fell to 54.23 and 52.18 index points,
respectively, from their levels in the preceding
and corresponding halves of 2021.


Table 2.3: Selected Countries' PMIs
Source: IHS Markit.
Emerging Markets and Developing Economies
Emerging Markets and Developing Economies
(EMDEs) experienced a downturn, driven mainly
by the lull in economic activities in China, India
and Russia. Specifically, growth in China and India
was estimated at 3.3 and 7.4 per cent, compared
with 8.1 and 8.7 per cent in 2021, respectively.
This was attributed to COVID-19 containment
measures in China and unfavourable external
conditions in India.
The PMI indicates that the Chinese economy
contracted in the first half of 2022, even as the
Indian economy decelerated recording 46.47 and
54.48 index points, respectively, in the first half
of 2022, from 50.15 and 55.04 index points in the
preceding half. In Russia, growth contracted by

2021H1
2021H2
2022H1
United States
60.3
59.93
54.43
United Kingdom
59.8
58.60
56.67
China
51.4
50.15
46.47
India
54.2
55.04
54.48
Germany
63.3
59.92
54.23
Italy
60.0
61.13
52.18
Japan
52.2
53.20
50.33
South Africa
51.0
49.23
49.47

CENTRAL BANK OF NIGERIA
Half Year Economic Report, 2022
This document is for CBN internal consumption
This document is for CBN internal consumption
This document is for CBN internal consumption
This document is for CBN internal consumption
6.0 per cent, against an expansion of 4.7 per cent
in 2021, following the impact of the sanctions
imposed on the economy.
In sub-Saharan Africa, output growth is projected
to moderate to 3.8 per cent, from 4.6 per cent in
2021. The forecast reflects the cushioning effects
of rising fossil fuel and metal prices for some
commodity-exporting
countries. The
South
African economy was projected to grow by 2.3
per cent, on the back of improved economic
activity, particularly towards the end of the
second half of the year, propelled by improved
job creation and increased demand.
2.2 GLOBAL INFLATION
Inflationary pressures increased in the first half of
2022, following the Russia-Ukraine war, which
exacerbated global supply chain disruptions, thus,
elevating energy, food, and commodity prices.
In AEs, prices generally rose further, owing to the
upsurge in energy prices. In the United States,
inflation was 9.10 per cent at the end of June
2022, compared with 5.4 per cent at the end of -
December 2021 and 4.80 per cent at end-June
2021. In the United Kingdom, inflation increased
to 9.40 per cent at end-June 2022, compared
with 4.80 per cent and 2.40 per cent at the endDecember 2021 and end-June 2021, respectively.
In Japan, consumer price index rose to 2.40 per
cent at end-June 2022, from 0.80 per cent at endDecember 2021 and 0.50 deflation at end-June
2021. Inflation in Germany and Italy rose to 7.50
per cent and 8.00 per cent, from 5.30 per cent,
and 3.90 per cent at end-December 2021,
respectively, and 2.35 per cent and 1.26 per cent
at end-June 2021.
In EMDEs, inflation increased in the first half of
2022, compared with the level in the second half
of 2021, due to increase in food and energy
prices, and supply disruptions in many sectors.
Specifically, inflation in China rose to 2.50 per
cent at end-June 2022, from 1.50 per cent at endDecember 2021 and 1.10 per cent at end-June
2021. Inflation in Russia and India increased to
15.90 and 7.01 per cent at end-June 2022, from
8.40 and 5.59 per cent in the preceding half, and
6.50 per cent and 5.58 per cent in the
corresponding half of 2021, respectively.
Similarly, inflation in sub-Saharan Africa also rose
during the first half of 2022, compared with the
level in the second half of 2021, driven majorly,
by rising food and energy costs. Inflation in South
Africa increased to 7.40 per cent at end-June
2022, from 5.90 per cent at end-December 2021
and 5.07 per cent at end-June 2021.
Figure 2.1: Inflation Rates in Selected Countries (per cent)

Source: Trading Economics Website.


United
States
United
Kingdom
Japan
Germany
Italy
Russia
India
South
Africa
Nigeria
Jun-21
Dec-21
Jun-22

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Table 2.4: Inflation in Selected Countries
Country
Jun-21
Jul-21
Aug-21
Sep-21
Oct-21

Nov-21
Dec-21
Jan-22
Feb-22
Mar-22
Apr-22
May-22
Jun-22
United States


United Kingdom


Japan


Germany


Italy


Russia


China


India


South Africa


Nigeria


Source: Trading Economics Website.

2.3 GLOBAL FINANCIAL MARKETS
Global Financial Conditions
Tight global financial conditions in the first half of
2022 influenced investors’ decision as they
rebalanced their portfolio across financial
instruments. Major equity indices declined, due
to monetary tightening by most central banks
and ensuing market reaction to surging inflation
and rising interest rates in most economies.
Specifically, growth in the S&P 500, DAX, Dow
Jones and NASDAQ-100 declined by 20.58 per
cent, 19.52 per cent, 16.37 per cent and 29.79
per cent respectively in the first half of 2022.
Similarly, EURO STOCK 50, NIKKIE 225 and
FTSE100 recorded decreases of 9.65 per cent,
9.93 per cent and 2.92 per cent, respectively.


Figure 2.2: Key Global Stock Indices

Source: Reuters and Bloomberg.
Government bonds rallied on the back of hawkish
monetary policy stance in response to elevated
inflation. Following forward guidance by the ECB
to end asset purchases early in the third quarter
of 2022, and the likely interest rate hike, yields in
the euro area increased by 1.52 percentage
points in the first half of 2022. Rate hike by the
Bank of England in the first half of 2022 resulted
in subsequent increase in the UK 10-year yield by
1.26 percentage points in the first half of 2022.
Similarly, 10-year government bonds yields in the
United States and Canada rose by 1.50 and 1.80

S&P500
Nasdaq-100
EURO STOCKS 50
TOPIX
DAX
Jun-22
Dec-21
Jun-21

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percentage points, respectively, from their level
in the preceding half.
In the EMDEs, yields on 10-year government
bonds in Brazil and China rose by 1.89 percentage
points and 0.05 percentage point in the first half
of 2022 relative to the preceding half.

Figure 2.3: 10-year Government Bond Yields for Selected
Countries

Source: Bloomberg.

Currencies
of
selected
emerging
market
economies weakened relative to the US dollar in
the review period. The South African rand,
Chinese RMB, and Russian rubles depreciated by
2.8 per cent, 0.8 per cent, and 6.7 per cent
against the US dollar to 15.40 rand, 6.49 RMB,
and 78.21 rubles, respectively. The depreciation
was due to the twin threats of rising US interest
rates and a looming global inflation.


Table 2.5: EMEs Exchange Rates/US$
Period
Chinese
RMB
Nigerian
naira
South
African
rand
Russian
ruble
H1 2020

H2 2020

H1 2021

H2 2021

H1 2022

Source: Central Bank of Nigeria

2.4 GLOBAL COMMODITY PRICES
War-related disruptions and policy restrictions
from major producing countries contributed to
the upward price movement of monitored
commodities in the first half of 2022. The RussiaUkraine war brought unprecedented disruptions
in production and supply chain network for most
commodities, especially wheat, edible oils, and
agricultural inputs such as fertilizers produced by
the warring countries. Furthermore, policy
restrictions from countries such as India and
Indonesia banning the export of wheat and palm
oil with the attendant high input cost and high
market demand, added to the pressure on prices.
The all-commodities index, at 104.5 index points
(2010=100), rose by 16.8 per cent and 35.5 per
cent above the levels in the preceding half and
the corresponding period of 2021, respectively.
The increase was driven by surge in the prices of
cotton, wheat, palm oil, soya-bean, coffee and
rubber by 36.0 per cent, 35.8 per cent, 32.9 per
cent, 22.3 per cent, 1.8 per cent, and 0.4 per cent,
respectively.
Palm oil and soybean prices rose on account of
pent-up demand, due to the April 28 export ban
by Indonesia, and increasing investment in

United
States
Canada
Germany Euro Area
United
Kingdom
France
Japan
China
Brazil
Jun-21
Dec-21
Jun-21

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biofuel operations in China and Southeast Asia. In
addition, prices of cotton rose due to supply
shocks amid droughts in West Texas, low crop
yield in India, soaring energy prices, and postCOVID-19 pandemic demand pressure.
The index of wheat, at 152.6 index points
(2010=100), rose by 35.6 per cent and 86.8 per
cent above the levels in the preceding half and
the corresponding period of 2021, respectively,
fuelled majorly by the Russia-Ukraine1 war.
The price index of coffee, at 112.1 index points
(2010=100), rose by 1.8 per cent and 38.6 per
cent above the levels in the preceding half and
the corresponding period of 2021, respectively.
Dry weather conditions in Brazil, supply chain
challenges and freight costs, supported the rise,
while the price of Rubber at 36.25 index points,
rose marginally by 0.4 per cent in the preceding
half, but declined by 23.8 per cent, compared
with the corresponding period of 2021. The price
increase for rubber during the review period was
attributed to the seasonal shortage of the
commodity amidst increasing world demand.
Similarly, the price of soya-bean, at 127.0 index
points, was 22.3 per cent and 15.6 per cent
higher than its levels in the previous half and the
corresponding period of 2021. The development
was driven by global supply tightening during the
first quarter of 2022, due to drought in Brazil that
delayed harvest, and a slowdown in exports,
coupled with the attendant high market demand,
especially from China.


1 Russia and Ukraine jointly account for 25.8 per cent and 11.4 per
cent of global wheat and edible oil exports, respectively.
Figure 2.4: Index of Major Agricultural Export Commodities

Source: Staff Computation based on data from Index Mundi

Figure 2.5: Trend of Major Export commodities Current vs
preceding/corresponding halves

Source: Staff Computation based on data from Index Mundi
Conversely, the prices of groundnut and cocoa
declined by 0.9 per cent and 0.5 per cent below
their levels in the preceding half year, but rose by
0.9 per cent and 2.2 per cent, respectively, above
their levels in the corresponding period of 2021.
The decline in the prices of groundnut and cocoa,
relative to the preceding half, was driven by
improved production, which more than offset
market demand.


2019 first half
2020 first half
2021 first half
2021 2nd half
2022 first half

% change
% change curent/corresponding
% change (current/preceding)

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Crude Oil Prices
Crude oil prices surged in the first half of 2022 due
to geopolitical tensions in Europe. Crude oil prices
surged due to heightened concerns about the
future availability of crude oil on the global
market. This was on account of the sanctions
imposed on Russian crude supply by the US and
the European Union’s decision to ban 90.0 per
cent of Russian crude oil by the end of 2022.
Consequently, the average spot price of Nigeria’s
reference crude, the Bonny Light, rose by 44.0
per cent in the first half of 2022 to US$110.96 per
barrel (pb) from US$77.08 pb in the second half
of 2021. It also rose by 71.2 per cent from
US$64.82 pb recorded in the corresponding half
of 2021.
Similarly, prices of the Brent, Forcados, West
Texas Intermediate (WTI) and OPEC Reference
Basket rose by 42.5 per cent, 44.7 per cent, 38.8
per cent and 39.3 per cent to US$109.94 pb,
US$111.60 pb, US$103.07 pb and US$105.47 pb,
respectively, relative to the second half of 2021.
The prices of all the crude streams rose,
compared with the levels in the corresponding
half of 2021.
Figure 2.6: Bonny Light Average Prices, 2017H12022H1(US$ per barrel)
Source: Refinitiv Eikon (Thomson Reuters
Figure 2.7: Average Monthly Crude Oil Prices, 2021-2022
(US$ per barrel)

Source: Refinitiv Eikon (Thomson Reuters)
Global Crude Oil Supply and Demand
Crude oil supply rose as OPEC+ agreed to increase
production. Total world crude oil supply averaged
99.02 million barrels per day (mbpd), a 1.6 per
cent increase above the level in the preceding
half of 2021. The rise was attributed, mainly to
the increase in aggregate OPEC supply by 10.68
per cent to 33.88 mbpd. Furthermore, the world
crude oil supply increased by 5.8 per cent above
the level in the corresponding half of 2021.
Aggregate crude oil supply, including natural gas
liquids (NGLs) and condensates by OPEC,
averaged 33.88 mbpd in the first half of 2022.
This represented an increase of 3.61 per cent and
10.68 per cent, above the levels in the preceding
half and corresponding half of 2021, respectively.
Out of this, OPEC crude share increased by 12.22
per cent to 28.38 mbpd, while the remaining
portion of OPEC supply, the Liquefied Natural Gas
(LNG) and condensates increased to 5.50 mbpd
in the first half of 2022, compared with 5.44
mbpd and 5.33 mbpd, in the preceding half and
corresponding half of 2021, respectively. The rise
in aggregate OPEC supply was driven largely, by
the OPEC+ decision to adjust the monthly
average crude oil production upwards by 0.4
mbpd.

US$ per barrel

Jan-21
Feb-21
Mar-21
Apr-21
May-21
Jun-21
Jul-21
Aug-21
Sep-21
Oct-21
Nov-21
Dec-21
Jan-22
Feb-22
Mar-22
Apr-22
May-22
Jun-22
US$/bbl
BONNY LIGHT
UK BRENT
FORCADOS
WTI-M*
OPEC-Basket

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World crude oil demand averaged 98.85 mbpd, a
0.55 per cent decrease, compared with 99.40
mbpd in the preceding half of 2021, and a 3.77
per cent increase, compared with 95.26 mbpd in
the first half of 2021. The Organisation for
Economic
Co-operation
and
Development
(OECD) countries' demand was 45.60 mbpd (46.0
per cent of the total world demand), while nonOECD countries accounted for the balance, at
53.25 mbpd.
Compared with the level in the corresponding
period of 2021, the rise in world crude oil
demand was driven, largely, by improved
mobility across the world economies, as
countries relaxed COVID-19 restrictions. Also, the
rise in global crude oil demand was supported by
increased fuel and diesel consumption as the
summer driving peaks in the US and Europe. In
comparison with the preceding period of 2021,
the global crude oil demand declined as
lockdown measures resurfaced in China over the
new wave of the COVID-19 pandemic.
2.5 CENTRAL BANKS’ RESPONSE
Most central banks tightened their monetary
policy stance to tame the persistent inflationary
pressures. In the United States, the Fed raised its
policy rate cumulatively by 275 basis points (bps)
to 1.75 per cent in the first half of 2022. The Bank
of England and the Bank of Canada also raised
their policy rates by 100 bps and 125 bps,
respectively, to 1.25 per cent and 1.75 per cent in
the review period. Furthermore, monetary
authorities in EMDEs, tightened rates to tame
inflation, and to retain and/or attract portfolio
investment. The Bank of Mexico increased its
repo rate by 225bps cumulatively to 7.75 per cent
in the review period. Other emerging market
central banks, such as South Africa, Egypt, and
Ghana, also raised policy rates in the first half of
2022. Conversely, China maintained a dovish
monetary stance, bringing the rates to 3.70 per
cent in the first half of 2022, from 3.80 per cent
in the second half of 2021.
Table 2.6: Monetary Policy Rates of Selected Central Banks
Country
2021H1
2021H2
2022H1
United States
0.3
1.75
4.5
United Kingdom
0.1
0.25
1.25
Japan
-0.1
-0.1
-0.1
Canada
0.5
0.5
1.75
Euro Area
0.0
0.0
0.0
China
3.85
3.80
3.70
India
4.0
4.0
4.9
Mexico
4.25
5.50
7.75
Turkey
19.0
14.0
14.0
Egypt
8.25
8.25
11.5
Ghana
13.5
14.5
19.0
South Africa
3.50
3.75
7.00
Nigeria
11.5
11.5
14.00
Source: Various Central Bank Websites.

2.6 FISCAL MEASURES
Many countries limited their fiscal space to
cushion the impact of the war in Ukraine on their
economies. Notably, the EU tightened economic
sanctions such as the ban on imports from Russia
of crude oil and refined petroleum products,
agricultural commodities, and SWIFT. The EU also
donated
an
emergency
Macro-Financial
Assistance (MFA) and the European Peace Facility
(EPF) support to the Ukrainian economy and
Armed Forces, respectively. The US government
issued sanctions on Russian leaders, top
businessmen
and
enterprises,
including
restricting the Central Bank of Russia from
withdrawing its dollar-denominated foreign
reserves.

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Section Three


Enabled by policy support, the domestic economy continued in the
recovery path in the first half of 2022.
❖ Monetary Policy
❖ Real Economy
❖ Fiscal Policy
❖ Financial Sector Developments
❖ Payments System Management
❖ External Sector Developments

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3.1 MONETARY POLICY


Major Economic
Development


Persistence of COVID-19
risk and weak global
supply chains

Heightened currency
speculation

Elevated global inflation

Insecurity-induced
inflationary pressure
Priorities of Monetary Policy


Ensure price stability

Strengthen financial
market fundamentals

Encourage credit flow to
the real sector


Implications


Persistence of
macroeconomic risk

Pressure on the exchange
rate

Declining but double-digit
inflation figure

Heightened investors’
sentiment


Monetary Policy Environment
Liquidity Management
The Bank continued to ensure an optimal level of banking system liquidity for the
attainment of its goal using Open Market Operation (OMO), complemented by
reserves requirement and discount window operation. Though the Bank
maintained an accommodative monetary policy stance at the beginning of the
period to sustain the fragile growth recovery, it, however, switched to a tight
policy stance in the later part of the period, to rein in inflation.

The monetary policy rate which remained at 11.50 per cent, for the greater part
of the first half of the year, was raised to 13.00 per cent in May 2022, to tame
inflation. Other policy parameters such as asymmetric corridor remain
unchanged at +100/-700 basis points around the MPR, the CRR at 27.5 per cent,
and the Liquidity Ratio at 30.0 per cent. The foreign currency trading position of
Authorized Dealers at the close of each business day remained at a maximum
limit of +0.5 per cent and -10.0 per cent of their shareholders’ fund unimpaired
by losses.
Exchange Rate Policy


Sustained intervention in the foreign exchange market and
retention of the I&E window to attract autonomous inflow of
foreign exchange to stabilise the domestic currency.
Instruments of MP
In the pursuit of its statutory
mandate, the Bank during the
review period, deployed an
array
of
monetary
policy
instruments.

The CBN Bill remained the
major instrument of
monetary policy,
complemented by:

Cash Reserve Ratio (CRR)

Standing Facilities
operations

Interventions in the
foreign exchange market.
Trend in Monetary Policy Rate (per cent)
Monetary Policy Decisions

24 and 25
January

The MPR at 11.50 per cent;
The Asymmetric Corridor of +100/-700 basis points
around the MPR;
The CRR at 27.5 per cent; and
The Liquidity Ratio at 30 per cent.

21 March

Retain the MPR at 11.50 per cent;
Retain the asymmetric corridor of +100/-700 basis
points around the MPR;
Retain the CRR at 27.5 per cent; and
Retain the Liquidity Ratio at 30 per cent.

23 and 24
May 2022
Raise the MPR to 13.00 per cent;
Retain the asymmetric corridor of +100/-700 basis
points around the MPR;
Retain the CRR at 27.5 per cent; and
Retain the Liquidity Ratio at 30 per cent.


Monetary Policy
objectives
Price stability
Headline inflation: 6-9%

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3.2 THE REAL ECONOMY
Domestic Output and Business Activities
Output
Positive output growth was sustained in the first
half of 2022, following the rebound in economic
activities, supported by robust fiscal and
monetary stimuli. Real Gross Domestic Product
(GDP) grew by 3.32 per cent, compared with 4.01
per cent and 2.70 per cent in the second half and
the first half of 2021, respectively. Despite global
headwinds, occasioned largely by the RussiaUkraine war, growth in the domestic economy
was realised on the heels of the return to
normalcy since the relaxation of the COVID-19
restrictions and sustained implementation of the
various economic stimulus packages by the fiscal
and monetary authorities.
Figure 3.2.1: GDP Growth Rate (per cent)

Source: National Bureau of Statistics (NBS)
Overall, the growth was broad-based across
sectors, and driven largely by the non-oil sector,
which grew by 5.42 per cent in the first half of
2022, compared with 5.07 per cent and 3.70 per
cent in the second half and the first half of 2021,
respectively. Continued growth in the sector was
driven, largely, by increased investments in ICT
infrastructure, thus, spurring increased economic
activities. Also, sustained fiscal and monetary
stimuli to critical sectors of the economy gave
impetus to the growth.
The Oil sector, however, constrained growth,
contracting by 19.71 per cent during the period,
compared with the contractions of 9.60 and 7.13
per cent in the second and first halves of 2021,
respectively. The deteriorating performance of
the Sector was attributed to the subsisting
production and technical challenges, which
manifested in high crude oil theft, vandalism, and
force majeure’ declared by Eni-Shell.
Sectoral Performance
Agriculture and Services grew, while Industry
contracted further in the first half of 2022.
Agriculture
Sustained policy support, clement weather
conditions, and reduced farmer-herder clashes
improved growth in the agriculture sector. The
performance of agriculture improved as it grew
by 2.15 per cent, compared with the 1.77 per
cent growth in the first half of 2021. However,
the sector’s growth was slower than the 2.38 per
cent in in the second half of 2021. This
development
was
supported
by
the
government’s renewed effort in providing
extension services to farmers, and continued
implementation of the National Livestock Breed
Improvement Programme, which, among others,
moderated the farmer-herder clashes. The effort
of the CBN to provide improved access to credit
in the sector also aided its performance.
Consequently, the crop production, livestock,
forestry, and fishery sub-sectors grew by 2.23 per
cent, 1.42 per cent, 1.33 per cent and 2.20 per
cent, respectively.


2018H1 2018H2 2019H1 2019H2 2020H1 2020H2 2021H1 2021H2 2022H1
Total GDP
Non-Oil GDP
oil GDP

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Figure 3.2.2: Agriculture Sector Performance (%)

Source: National Bureau of Statistics (NBS)

Industry
Subsisting technical and production challenges,
especially in the crude petroleum and natural gas
sub-sector, further constrained the performance
of the sector. Industry contracted by 4.73 per
cent in the first half of 2022, compared with 0.86
per cent and 0.08 per cent contractions in the
preceding and corresponding halves of 2021,
respectively. The Sector constrained overall
growth by 1.1 percentage points during the
period. The poor performance of the sector was
attributed to the dip in the output of crude
petroleum and natural gas, owing to continued
production
and
technical
challenges,
characterised by incessant oil theft and aging
infrastructure. Also, oil refining dipped on
account of non-functional local refineries.
The weak performance of the sector was
reflected in the index of industrial production,
which, at 98.6 index points (2010=100), declined
by 6.8 per cent, compared with 105.8 index
points in the corresponding period of 2021. It,
however, increased by 1.4 per cent, compared
with 97.2 index points in the second half of 2021.

Figure 3.2.3: Index of Industrial Production

Source: Computed based on data obtained from NBS and
Manufacturing Association of Nigeria (MAN)

The
Manufacturing
sub-sector,
however,
contributed the most to growth within the sector
by 0.4 percentage point and grew by 4.55 per
cent, compared with 3.26 per cent and 3.44 per
cent in the preceding and corresponding halves
of 2021, respectively. The improvement in the
subsector was attributed to innovative supply
chain delivery systems and other cost-cutting
measures. The sub-sector showed resilience in
the face of higher energy prices and weaker
purchasing power of citizens owing to rising
inflationary pressures. Also, the increased
performance was also achieved on the heels of
rising demand for locally manufactured goods,
resulting in higher manufacturing capacity
utilisation, which increased by 0.5 percentage
point and 1.2 percentage points to 54.7 per cent,
from 54.2 per cent and 53.5 per cent in the
second half and first half of 2021, respectively.

Construction sustained its upwards growth
trajectory, expanding by 4.48 per cent in the first
half of 2022, compared with a growth of 3.75 per
cent and 2.40 per cent in the preceding and
corresponding halves of 2021, respectively. The

Crop Prod.
Livestock
Forestry
Fishing
Agric (RHS)


2 0 1 9 H 1 2 0 1 9 H 2 2 0 2 0 H 1 2 0 2 0 H 2 2 0 2 1 H 1 2 0 2 1 H 2 2 0 2 2 H 1
INDEX
Manufacturing
Mining
Electricity
Industry

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sub-sector contributed 0.2 percentage point to
overall output. The positive performance of the
sub-sector was attributed to the continued effort
of the government to deepen the quality of
infrastructure in the country and sustained
investment in the construction of houses.
In addition, the water supply, sewage and waste
management sub-sector grew by 19.41 per cent,
compared with 20.19 per cent and 16.92 per cent
in the preceding and corresponding halves of
2021, respectively. This resulted to a 0.1
percentage point contribution to overall growth.
The improved performance of the sub-sector was
driven by increased investment in water supply
projects, including the N23.50 billion World Bank
Assisted Upgraded Bauchi Township Water
Supply Scheme.
However, the Electricity, Gas, Steam & Air
conditioner subsector contracted by 11.42 per
cent in the first half of 2022, in contrast to 7.51
per cent and 56.58 per cent growth recorded in
the previous and corresponding halves of 2021,
respectively. The contraction was driven mainly
by the decline in electricity generation and
consumption, as the country witnessed incessant
grid collapse following a significant downturn in
power generation during the first half of 2022.
Reduced gas supply and low water level to hydro
generation stations were responsible for the low
generation.
Thus, the average electricity generation, at
3,801.9 MW/h, decreased by 9.4 per cent and 5.2
per cent, compared with 4,157.9 MW/h and
3,998.60 MW/h in the second and first halves of
2021, respectively. Similarly, at 3,333.1 MW/h,
the average electricity consumption fell by 10.2
per cent, compared with 3,672.1 MW/h in the
corresponding period of 2021, but rose by 0.5 per
cent, compared with 3,317.8 MW/h in the second
half of 2021. Challenges occasioned by theft and
vandalism of transmission and distribution
networks, as well as planned maintenance,
contributed to the low wheeling capacity to end
users.
Table 3.2.1: Industry Sector Performance (Growth
Rates)

2020H1
2020H2
2021H1
2021H2
2022H1
Industry
Sector

Mining and
Quarrying

Manufacturing

Electricity,
Gas, Steam &
Air conditioner

Water supply,
sewage, waste
Management.

Construction

Source: National Bureau of Statistics (NBS)

Industrial activities
Industrial activities in the first half of 2022 rose
marginally, compared with the second half of
2021.
This
was
attributed
to
increased
manufacturing activities and improved business
conditions and confidence. The index of industrial
production, at 98.6 index points (2010=100),
increased by 1.4 per cent, compared with 97.2
index points in the second half of 2021. The
sector’s activities, however, declined by 6.9 per
cent, compared with 105.6 index points in the
corresponding period of 2021.
Industry sub-sector analysis revealed that the
index of mining production at 57.9 index points
(2010=100), declined by 19.3 per cent, compared
with 71.7 index points in the corresponding half
of 2021. This was due to low crude oil production,
as investment dipped in the upstream sector,
with plans by major oil companies to divest. Also,
infrastructural challenges, including oil pipeline
leakages, fire incidence and poor maintenance of

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oil production facilities, contributed to the low
performance. However, the performance of the
sub-sector increased tepidly to 57.9 index points,
compared with 57.0 index points in the second
half of 2021.
Despite the rising cost of production, the
manufacturing sub-sector recorded an improved
performance. This was partly due to the
crystallisation of the impact of monetary and
fiscal stimulus in the real sector. Also, the
increased performance was due to rising demand
for locally manufactured goods, resulting in an
upsurge in manufacturing capacity utilisation.
Consequently, the index of manufacturing
production rose by 0.2 per cent and 4.6 per cent
to 185.9 index points (2010=100) in the first half
of 2022, compared with 185.5 index points and
177.8 index points in the second half and the
corresponding period of 2021. Similarly, the
estimated manufacturing capacity utilisation in
the first half of 2022, also increased by 0.5
percentage point and 1.2 percentage points to
54.7 per cent, from 54.2 per cent and 53.5 per
cent in the second half and first half of 2021,
respectively.
Figure 3.2.4. Index of Industrial Production

Source: Computed based on data obtained from NBS and
Manufacturing Association of Nigeria (MAN)


Industrial Financing
The provision of credit facilities to support
industrial activities was sustained, especially by
the Bank of Industry and the Nigeria ExportImport Bank.
•
The Bank of Industry
Total credit disbursed by the Bank of Industry
(BOI) to the industrial sector in the first half of
2022 rose by 28.0 per cent, to N106.90 billion,
from N77.00 billion in the first half of 2021. The
increase was attributed to a rise in the number of
approved applications. From the disbursements,
large enterprises got N84.40 billion (79.0 per
cent), while small and medium enterprises
received N22.50 billion (21.0 per cent).
A sectoral analysis of the disbursements showed
that food processing was allocated N28.80 billion
(26.9 per cent), followed by the healthcare &
petrochemicals sector, N19.90 billion (18.6 per
cent), creative industry received N14.90 billion
(13.9 per cent) of the total, oil & gas sector
N13.00 billion (12.1 per cent), solid minerals
N12.6 billion (11.8 per cent). Others included;
agro processing N9.10 billion (8.5 per cent),
engineering & technology, N7.30 billion (6.8 per
cent). While financial services received N0.90
billion (0.8 per cent), gender business N0.4 billion
(0.4 per cent), and renewable energy N0.10
billion (0.1 per cent).


2 0 1 9 H 1
2 0 1 9 H 2
2 0 2 0 H 1
2 0 2 0 H 2
2 0 2 1 H 1
2 0 2 1 H 2
2 0 2 2 H 1
INDEX
Manufacturing
Mining
Electricity
Industry

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Figure 3.2.5: Summary of BOI Disbursements by
Sector, 2022H1 (per cent)

Source: Bank of Industry


•
The Nigeria Export-Import Bank
The total funding support provided to the non-oil
export sector, under the Nigeria Export-Import
Bank (NEXIM) lending facilities in the first half of
2022 was N31.61 billion for 27 projects,
compared with N54.40 billion to 38 projects in
the second half of 2021 and N24.06 billion for 23
projects in the corresponding period of 2021. The
decrease in funding new projects was attributed
to increased credit risk perception arising from
heightened global uncertainties.
A breakdown of the disbursement by facility
shows that 51.0, 38.0, and 11.0 per cent were
disbursed under Rediscounting & Refinancing
Trade Finance, and Foreign Input Facilities,
respectively.


Figure 3.2.6: Summary of NEXIM Disbursement by
Facility in 2022H1 (per cent)

Source: NEXIM
A sectoral analysis of the disbursement showed
that the agricultural sector received N26.53
billion (84.0 per cent). This was followed by the
manufacturing sector with N5.03 billion (15.9 per
cent) and solid minerals, N0.05 billion (0.1 per
cent).
Figure 3.2.7: Summary of NEXIM Disbursement by
Sector in 2022H1

Source: NEXIM

•
Renewable Energy
Electrification to the unserved and underserved
communities improved in the review period. The
Rural Electrification Agency (REA) continued to
provide electrification for the rural areas under
the Rural Electrification Fund (REF), the Capital
Project (CP) and the Nigerian Electrification
Project (NEP). A total number of 159 and 250 offAgro
Processing
(8.5%)
Creative
Industry
(13.9%)
Engineering
&
Technology
(6.8%)
Financial
Services
(0.8%)
Food Processing
(26.9%)
Gender
Business
(0.4%)
Healthcare
&
Petrochemi
cals (18.6%)
Oil & Gas
(12.1%)
Renewable
Energy
(0.1%)
Solid
Minerals
(11.8%)
Trade Finance
Facility
38%
Rediscounting
& Refinancing
Facility
51%
Foreign Input
Facility(WC)
11%
Agriculture
84%
Manufacturing
16%
Solid Minerals
0.1%

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grid solar power projects were completed and
ongoing, respectively, while the total installed
and available capacity of the off-grid solar power
completed and ongoing were 6,998.72 KW and
27,737.19 KW, respectively. Also, the total
number of connections to the mini-grid and solar
home system completed and ongoing were
746,818 and 507,571, respectively. However,
challenges such as insecurity, insufficient funds
and logistics, amongst others, continued to
constrain the agency.
The major source of funding for NEP, REF and CP
are from the World Bank and the African
Development Bank (AfDB) credit facilities, REA
and the Federal Government’s annual capital
budget, respectively.

Table 3.2.2: Summary of Renewable Energy Projects
S/N
Project title
Completed
Ongoing

Total number of off-grid
solar power project
159 (total)

(total)
68 (NEP)
188 (NEP)
26 (REF)
62 (REF)
65 (CP)

Total installed and
available capacity of the
off-grid solar power
(KW)
6,998.72 (total)
27,737.19
(total)
4,107 (NEP)
23,712.19
(NEP)
1,341 (REF)
4,025
(REF)
1,550.72 (CP)

Total number of
connections to the offgrid (mini-grids and
solar home system)
746,818 (total)
507,571
(total)
721,211 (NEP)
141,920
(NEP)
24,022 (REF)
365,651
(REF)
1,585 (CP)

Source: Rural Electrification Agency (REA)

Services
Services sustained its robust performance, owing
to an improved business environment and
increased leverage of ICT services and access to
credit. The Sector grew by 7.07 per cent in the
first half of 2022, compared with 6.84 per cent
and 4.27 per cent in the second half and first half
2021,
respectively,
and
contributed
3.9
percentage points to the overall GDP growth.

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Source: National Bureau of Statistics (NBS)

The Information and Communications
Technology
The
Information
and
Communications
Technology (ICT) sub-sector grew by 9.06 per
cent, compared with 7.11 per cent and 5.97 per
cent in the second and first halves of 2021,
respectively. The growth was triggered by the
increase in the number of active mobile lines,
which crossed the 200 million mark in April 2022
to reach 206,081,720 subscriptions at the end of
first half of 2022.
Consequently, in the first half of 2022,
teledensity across the country increased to
108.15 per cent, compared with 102.40 per cent
and 98.28 per cent in the preceding and
corresponding halves of 2021, respectively. The
broadband subscription and penetration levels
also increased to 84,607,363 and 44.32 per cent,
respectively. This development was driven by
increase in network coverages and demand,

following increased private sector participation
and online trading activities in the economy.
In addition, the Nigerian Communications
Commission (NCC) issued the International
Gateway and the Internet Service Provider (ISP)
licences to Starlink Internet Services Nigeria Ltd
to operate in Nigeria.
Fig 3.2.8: Active Telephony Subscriptions and
Teledensity in the first half 2022

Data Source: Nigerian Communications Commission (NCC)


end-June

end-Dec

end-June

end-Dec

end-June

end-Dec

end-June

Teledensity (%)
Number Of Subscriptions
Subscriptions
Teledensity
Table 3.2.3: Services Sector Performance (Growth Rates)

2020H1
2020H2
2021H1
2021H2
2022H1
Growth
Contribution in
2022H1
Services Sector

Trade

Accommodation and Food Services

Transportation and Storage

Information and Communication

Arts, Entertainment & Recreation


Financial and Insurance

Real Estate

Professional, Scientific & Technical Serv.

Administrative and Support Services


Public Administration

Education

Human Health & Social Services


0.03
Other Services


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Finance and Insurance sub-sector
The finance and insurance sub-sector expanded
by 20.88 per cent, compared with 23.74 per cent
growth in the preceding half and a contraction of
1.47 per cent in the corresponding half of 2021.
Improved access to consumer credit following
the continued implementation of the loan-todeposit ratio policy and other policy measures by
the Bank supported the growth of the financial
institutions' sub-sector during the period.
The Transport and Storage sub-sector
The Transport and Storage sub-sector grew by
15.40 per cent, compared with 26.39 per cent
and 6.30 per cent in the preceding and
corresponding halves of 2021, respectively. The
growth was driven by sustained government and
institutional
support
towards
boosting
infrastructure in the sector and addressing the
scarcity of petroleum products. There was also
notable increase in passenger and cargo
movement across the sub-sector activities of air,
rail and water transport.
The volume of passengers airlifted in both the
domestic and international routes increased by
1.4 per cent to 8.9 million passengers during the
period, compared with the corresponding half of
2021. However, this was lower than the number
recorded in the second half of 2021 by 11.6 per
cent. Similarly, the volume of domestic-bound
passengers transported by air increased by 22.7
per cent in the first half of 2022, over the 5.9
million passengers airlifted in the corresponding
half of 2021. It, however, declined by 16.9 per
cent, when compared with 8.7 million passengers
in the second half of 2021. The increase in the
volume of domestic bound passengers was due
to the persistent security challenges affecting
road transport and rail. The volume of foreign
passengers also rose, significantly, by 87.6 per
cent and 21.1 per cent, from 0.90 million and 1.4
million passengers airlifted in the first and second
halves of 2021, respectively.
Aircraft movement rose by 13.0 per cent to
140,966 flights in the first half of 2022, compared
with the corresponding period of 2021, but
declined by 12.5 per cent below the level in
second half of 2021.
Mail movement rose to 40.8 million kg in the first
half of 2022, an increase of 8.4 per cent and 12.0
per cent, above the levels in the first and second
halves of 2021, respectively. However, cargo
movement declined by 49.7 per cent and 30.3 per
cent to 63.6 million kg, compared with the
corresponding half of 2021 and the second half
of 2021.
Activities in the marine sector declined compared
with the first and second halves of 2021. This was
observed in the decrease in the number of
oceangoing vessels that berthed at the nation’s
ports to 1,992 in the first half of 2022, from 2,005
vessels in the first half of 2021, and 2,095 in
second half of 2021. This further affected the
volume of cargoes discharged and loaded at the
ports, as cargo throughput, which stood at
39,971,942 metric tons and 39,916,165 metric
tons in the first and second halves of 2021,
decreased to 38,672,392 metric tons in the
review period. The decrease in the first half of
2022 represents a decline of 3.12 per cent and
3.25 per cent from the corresponding and
previous halves of 2021, respectively. The
development was occasioned by reduced
demand for imported consumer items on
account of tighter macroeconomic environment
and weaker purchasing power.

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Other sub-sectors included, Trade (5.50 per
cent), Real Estate (4.43 per cent), Human Health
& Social services (4.00 per cent), ‘Other Services’
(3.10 per cent), Administrative and Support
Services (2.87 per cent), Accommodation and
Food
Services
(2.24
per
cent),
Public
Administration (1.97 per cent) and Professional,
Scientific & Technical Services (1.90 per cent),
also grew during the review period.
Health
The Federal Government continued to strengthen
institutions to improve the quality and coverage
of health care services. Thus, the Federal
Government launched a N62.10 billion Fund to
sustain the country’s HIV response, address killer
diseases and public health emergencies. It also
unveiled a National Biosecurity Policy and Action
Plan for 2022-2026 to secure the health sector
and its immediate environment from biological
threats.
To deepen access to health insurance coverage
and increase private sector participation in the
provision of health insurance services, the
National Health Insurance Authority (NHIA) bill
was enacted during the review period. The Act
establishes and empowers the NHIA to ensure
the provision of mandatory health insurance for
all Nigerians, in collaboration with state health
insurance agencies, and to improve and harness
private sector participation in the provision of
health care services. Also, the new Act stipulates
the establishment of a new Vulnerable Group
Fund to provide subsidy for health insurance
coverage for vulnerable people.
Furthermore, the Federal Government officially
flagged-off the enrolment of Corps Members into
the National Health Insurance Scheme (NHIS).
The health initiative, known as NYSC Group
Individual
Family
Social
Health
Insurance
Programme (GIFSHIP), was designed to cover the
periods of Pre-Orientation, until the end of
Service of a Corps member, which is three weeks
after disengagement from Service. Six Health
Maintenance
Organisations
(HMOs)
were
selected for each geo-political zones to drive the
process.
COVID-19 Update
The rate of active cases of COVID-19 infections
declined, following sustained surveillance by
relevant health authorities, compliance with
containment
measures,
and
a
sustained
vaccination drive. This followed a significant
decline in the newly confirmed cases and
recorded deaths. The rate of increase in the
number of confirmed cases moderated in the
first half of 2022 to 6.3 per cent, compared with
44.6 per cent and 91.3 per cent in the second half
and corresponding half of 2021, respectively.
Similarly, the rate of discharged cases declined to
16.8 per cent, compared with 30.5 per cent and
122.8 per cent in the second half and
corresponding half of 2021, respectively. In
addition, the death toll declined by 3.7 per cent
as against 43.0 per cent in the second half, and
64.5 per cent in the corresponding period of
2021.

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Fig 3.2.9: COVID-19: Confirmed, Discharged and
Death Cases in the First Half of 2022
Source: National Centre for Disease Control (NCDC)
During the review period, Nigeria received a
donation of 3.2 million Pfizer COVID-19 vaccines
from the United States; 2 million doses of
Johnson & Johnson (J&J) vaccines from the
European Union and another 4.4 million doses of
J&J from the government of Spain, and 859,600
doses of AstraZeneca vaccines from the Japanese
Government.
Housing
The Federal Government sustained efforts to
increase the delivery of housing to citizens as it
commissioned a total of 372 housing units in
Nasarawa, Delta, Kaduna, Kogi and Osun states in
the first half of 2022. Out of the 372 housing units
delivered in the review period, Nasarawa State
got 76 units, while Delta, Kaduna, Kogi and Osun
states got 68, 80, 76, and 72 units, respectively.

Education
The government’s commitment to increase
access to formal education, especially at the
tertiary level, was sustained with the licensing of
new educational institutions. To increase access
to tertiary institutions, the Federal Executive
Council
(FEC)
approved
the
issuance of
provisional licences for the establishment of 12
additional private universities across the country.
They included Pen Resource University Gombe
(Gombe State), Al-Ansar University, Maiduguri
(Borno State), Margaret Lawrence University
(Delta State), and Khalifa Ishaku Rabiu University
Kano (Kano State). Also on the list were Sports
University Idumuje Ugboko (Delta State), Baba
Ahmed University Kano, Saisa University of
Medical Sciences and Technology (Sokoto State),
Nigerian-British University Hasa (Abia State) and
Peter University Acina-Onene (Anambra State).
Others were Newgate University, Minna (Niger
State), European University of Nigeria in Duboyi
(Abuja) and the North-West University Sokoto. In
a related development, the FEC approved the
establishment of three new Federal Polytechnics,
located in Umunnoechi in Abia State, Orogun in
Delta State, and Kabo in Kano State. They would
commence academic activities in October 2022.
The National Universities Commission (NUC) also
granted approval for the establishment of two
new universities by the Lagos State Government.
The new universities would be developed
through the conversion of selected old higher
learning institutions in the State. Consequently,
the old polytechnic in Ikorodu became the
University of Science and Technology, while the
Adeniran Ogunsanya College of Education,
Ijanikin, and the Michael Otedola College of
Primary Education, Epe, were merged to form the
Lagos State University of Education. The creation
of the two institutions would increase the State’s
capacity to cater for the growing population of
admission seekers, while increasing access to
higher education in the country.
To
provide each senatorial
district
with
opportunities to drive e-learning and foster a

H2 2020
H1 2021
H2 2021
H1 2022
Total Confirmed Cases (LHS)
Discharged Cases (RHS)
Death Toll (RHS)

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digital environment, the Federal Government
approved N964.00 million for the provision of
satellite-based education system equipment in
111 primary schools (three primary schools in
each of the 36 States of the Federation and the
Federal Capital Territory).
Furthermore, the Universal Basic Education
Commission (UBEC) constructed six ICT schools in
the six geopolitical zones at a cost of N21.60
billion.
The Nigerian Communications Commission (NCC)
gave 16 Nigerian universities a total of N232.50
million
telecommunications
research
and
development grant to boost the development of
the education sector. The researchable areas,
which were technology based included: 5G
Deployment; Innovative Clean Energy; Advanced
Method of Quality of Service (QoS)/Quality of
Experience Management and Test Mechanism;
Internet of Things (IoT) Low Power Wide Area
Network (LPWAN) Technology; and Monitoring
and Localising of Drones.
Social Intervention
The
Federal
Government
sustained
its
interventions aimed at improving the livelihood of
its citizens during the period. As part of the effort
toward poverty eradication and sustenance of
the National Social Investment Programmes
(NSIPs),
the
Federal
Government,
in
collaboration with the CBN, flagged off the
NEXIT/CBN Agri-Business Small and Medium
Enterprises Investment Scheme for exited NPower beneficiaries Batches A and B.
Also, Google keyed into the Government’s
entrepreneurship
development
drive
by
announcing US$1.00 million in support for
African women, including Nigerian women
entrepreneurs, to help grow their businesses.
The Tech Giant also provided free tools to
support their businesses by launching an
intensive programme to drive the discovery of
women-owned
businesses
through
Google
Business Profiles. This would help businesses
create a free webpage to make it easier for them
to be more accessible online.
•
Employment and Job Creation
The Federal Government sustained its effort to
improve employment by partnering with various
stakeholders. The Government approved the
opening of an employment and job creation
portal called the Nigerian Labour Exchange
(NILEX) to improve the database and the access
to employment opportunities in the country. The
platform would keep records of job vacancies and
the skills of job seekers as well as unemployed
Nigerians in the diaspora.

Consumer Prices
Rising food and energy prices and lingering
security challenges fuelled headline inflation
upward in the first half of 2022, thus reversing its
downward trend in the second half of 2021. The
reversal was driven, mainly, by increased prices
of food and non-food items. In addition, the
effects of soaring energy prices (such as diesel
and gas), persisting structural bottlenecks, and
lingering security challenges contributed to the
rising inflation. Hence, headline inflation (yearon-year) rose to 18.60 per cent from 15.63 per
cent and 17.75 per cent in the second and first
halves of 2021, respectively. However, headline
Inflation (Month-on-Month) in the first half of

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2022 remains unchanged from its level of 1.82
per cent in the second half of 2021.
Figure 3.2.10: Headline Inflation Rate (per cent)
2018H1 to 2022H1

Source: National Bureau of Statistics (NBS)

Food Inflation
Food inflation rose persistently in the first half,
driven, mainly, by lingering security challenges,
rising input costs, and exchange rate passthrough to domestic prices. Specifically, prices of
farm produce continued to rise on the heels of
persisting security challenges that constrained
farming activities, leading to disruptions in the
supply of food items. Also, prices of processed
food items maintained an upward trajectory due
to persisting structural challenges that hampered
food
processing
activities,
especially,
the
increased prices of diesel and other input.
Continued uptick in food prices was further
supported by an increase in the price of imported
food, which contributed an average of 4.4
percentage points to the increase in food prices.
Thus, food inflation (year-on-year) rose to 20.60
per cent, from 17.37 per cent in second half of
2021, but lower than the 21.83 per cent in the
first half of 2021. On the other hand, the Monthon-Month food inflation declined to 2.05 per cent
at end-June 2022, compared with 2.19 per cent
in the second half of 2021.
Figure 3.2.11: Food Inflation Rate (per cent)2018H1
to 2022H1

Source: National Bureau of Statistics (NBS)

Core Inflation
Core inflation (all-items less farm produce)
sustained its rise to 15.75 per cent, compared
with 13.87 per cent and 13.09 per cent in the
preceding and corresponding halves of 2021,
respectively. The persistent rise in core inflation
was, largely, attributed to the effect of higher
import
prices,
increase
in
the
cost
of
transportation/logistics, and heightened security
challenges.
Figure 3.2.12: Core Inflation Rate 2018H1 to 2022H1

Source: National Bureau of Statistics (NBS)


Year on Year (LHS)
Month on Month (RHS)

Year on Year(LHS)
Month on Month (RHS)

2018H1
2018H2
2019H1
2019H2
2020H1
2020H2
2021H1
2021H2
2022H2
Year on Year(LHS)
Month on Month (RHS)

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Domestic Commodity Prices
The Prices of most domestic agricultural
commodities monitored trended upward in the
first half of 2022. Despite improved output,
domestic prices of agricultural products were
higher than their levels in the second and first
halves of 2021. The development was induced by
structural factors such as: high transportation
costs, driven by an increase in the price of diesel;
supply shortages, resulting partly from the
persisting security challenge; high demand;
scarcity of foreign exchange for importation; and
the Russia-Ukraine war, which further strained
the food supply chain, especially imported
commodities like wheat and edible oils.
The dynamics in agricultural commodity prices,
compared to the preceding half indicated
increase in onion bulb (21.1 per cent), vegetable
oil (20.1 per cent), groundnut oil (18.7 per cent)
and palm oil (18.4 per cent). Relative to the
corresponding period of 2021, the edible oils
increased by 46.1 per cent (groundnut oil), 45.5
per cent (palm oil), and 45.4 per cent (vegetable
oil).
Other commodities also recorded an increase
ranging from 2.1 per cent for garri yellow (sold
loose) to 16.9 per cent for sweet potato. The
upward
price
movement
exacerbated
inflationary pressure in the review period.


Table 3.2.4. Domestic Agricultural Commodity
Prices


1st
Half,

2nd
Half,

1st
Half,

%
change
%
change
FOOD ITEM


Unit

(1)
&(3)
(2) &
(3)
Agric eggs medium size
"

Beans brown,sold loose
"

Beans:white black eye.
sold loose
"

Gari white,sold loose
"

Gari yellow,sold loose
"

Groundnut oil: 1 bottle,
specify bottle
"

Irish
potato

"

Maize grain white sold
loose
"

Maize grain yellow
sold loose
"

Onion
bulb

"

Palm oil: 1
bottle,specify bottle
"

Rice agric sold loose
"

Rice local sold loose
"

Rice Medium Grained
"

Rice,imported high
quality sold loose
"

Sweet potato
"

Tomato

"

Vegetable oil:1
bottle,specify bottle
"

Wheat flour:
prepacked (golden
penny 2kg)
"

Yam
tuber

"

Source: National Bureau of Statistics (NBS)

Agricultural production
Agricultural production index, at 149.3 points
(2010=100), grew by 2.2 per cent and 4.6 per
cent above the levels in the second and first
halves of 2021. Relative to the preceding half, the
crop and fishery sub-sectors grew by 2.1 per cent
and 2.0 per cent, respectively, followed by
livestock and forestry sub-sectors at 1.3 per cent,
apiece. The performance of the sub-sectors was
driven by sustained policy interventions and
favourable weather condition.

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Fig 3.2.13: Agriculture Production Index 2019HI
to 2022HI

Source: National Bureau of Statistics (NBS)

Table 3.2.5: Agricultural Production Index

First Half 2021, Second Half 2021, First Half 2022

%(3&1)
%(3&2)
Aggregate

Crops

Staples

other
crops

Livestock

Fishery

Forestry

Source: National Bureau of Statistics (NBS)

The Extractive Industry
Crude Oil
Policy and Institutional Support
To optimise the nation’s hydrocarbon resources,
the Nigerian Upstream Petroleum Regulatory
Commission (NUPRC), awarded PetroleumProspecting Licences (PPLs) to indigenous
operators for 57 marginal oil fields. This was in
addition to the 30 marginal oil field licences
issued earlier. The oil fields were awarded to
qualified indigenous companies to encourage
greater participation in the petroleum industry.
The firms were given six years to develop the
fields and commence full oil production.
To bridge the cost of transportation, and
encourage investment in the transportation of
petroleum products, the Federal Government
increased the freight rate for petroleum product
marketers by N10.00 per litre (95.6 per cent) to
N20.46 per litre. The review was necessitated by
the high cost of transporting petroleum products
nationwide.
Crude Oil Production
At an average daily production of 1.36 million
barrels per day (mbpd), Nigeria’s crude oil output
in the first half of 2022, declined by 6.8 per cent
below the comparative periods in 2021. The
decline in domestic crude oil production was due,
largely, to rising cases of sabotage, which led to
TotalEnergies, Shell and Eni declaring force
majeures on Forcados, Bonny Light, and Brass
crude streams export in February and March
2022, respectively.

Figure 3.2.14: Average Crude Oil Production (Million
barrels per day)
Source: Refinitiv Eikon (Thomson Reuters)


A g g r e g a t e
C r o p s
S t a p l e sO t h e r C r o p sL i v e s t o c k
F i s h e r y
F o r e s t r y
First Half 2019
First Half 2020
First Half 2021
Second half 2021
First Half 2022


Millions of barrels per day

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Refinery Operations
The three Federal Government owned refineries,
with a combined refining capacity of 445,000
barrels per day (bpd), remained shut, due to
rehabilitation. Output from the Walter Smith
Refinery and Niger Delta Petroleum Resources
modular refineries, though operational, was
inadequate to boost the consolidated capacity
utilisation rate and meet domestic demand.
Table 3.2.6. Status of Operation of Refineries in
Nigeria in the First Half 2022
S/No
Plants
Capacity
(bpd)
Status

Port Harcourt Refining
Company (PHRC)
210,000
Under
rehabilitation

Kaduna Refining and
Petrochemical
Company (KRPC)
110,000
Under
rehabilitation

(Warri Refining and
Petrochemical
Company WRPC)
125,000
Under
rehabilitation

Walter Smith Refinery
5,000
Operational

Niger Delta Petroleum
Resources
1,000
Operational

Dangote Refinery
650,000
Under
construction
Source: Fitch Solutions

Gas Production and Utilisation
Estimated gas production in the first half of 2022
was 990,829 million standard cubic feet (mscf),
compared with 1,043,196 mscf and 1,032,278
mscf in the second and first halves of 2021,
representing a decrease of 5.02 per cent and 4.02
per cent, respectively.
Of the total gas produced, 94.0 per cent (981,079
mscf) was utilised, while the remaining 6.0 per
cent was lost through gas flaring. Of the utilised
gas, 5.3 per cent was expended as fuel gas, while
1.9 per cent, 4.4 per cent, 12.8 per cent, and 39.8
per cent were for Natural Gas Liquids/Liquified
Petroleum Gas, Escravos Gas-to-Liquid (EGTL),
domestic use, and Nigeria Liquified Natural Gas,
respectively. 29.5 per cent of the total gas
production was re-injected. Estimated value of
gas exported in the first half of 2022 was
US$3,044.65 million, a 12.43 per cent and 2.28
per cent increase from the US$2,708.01 million
and US$2,976.83 million in the corresponding
period of 2021 and preceding half of 2021,
respectively.
Figure 3.2.15: Gas Production, Utilisation and Flared,
2021 – 2022 (Billion mscf)
Source: NNPC Monthly Oil Reports

Jan-21
Feb-21
Mar-21
Apr-21
May-21
Jun-21
Jul-21
Aug-21
Sep-21
Oct-21
Nov-21
Dec-21
Jan-22
Feb-22
Mar-22
Apr-22
May-22
Jun-22
Billion scf
Gas Produced
Gas Utilised
Gas Flared

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Box 1: Policy Support and Developments in the Real Sector

Sector
Developments

Crop
Production

Several institutional support policies were implemented in the review period to improve agricultural sector output:
•
The Federal Executive Council (FEC) approved the sum of N1.40 billion for the procurement of equipment and agricultural
inputs for the National Youth Farmers Scheme.
•
The FEC also approved a memo to promote agriculture business in Nigeria through right farm gate pricing and the ban on
foreigners and their representatives from purchasing agricultural commodities at the farm gates.
•
The Federal Government launched the Energizing Agriculture Programme (EAP), with funding support from the Global Energy
Alliance for People and Planet (GEAP) to improve access to electricity in rural farming communities.
•
The National Varieties Release Committee (NVRC) in Nigeria approved the commercialisation of 45 new crop varieties, with
two varieties of gingers registered for proper documentation in the nation’s seeds catalogue.
•
Tomato and onion farmers in Kano State received new high-yielding varieties, Takahe onion seed and Xaman tomato seed, to
boost their productivity. The new varieties were products of collaborations between Sasakawa Africa Association (SAA), Kano
State Agro-Pastoral Development Project (KSADP), Alliance for Green Revolution (AGRA) and Bayer Company.
•
Nigeria and Ghana collaborated on Pod Borer Resistant (PBR) Cowpea to further enhance scientific bilateral collaboration for a
“New Africa.”
•
Julius Berger Nigeria (JBN) Plc established a cashew processing plant in Epe, Lagos State. The plant is highly efficient with nowaste, designed to have less impact on the environment.
•
An ultra-modern 420 metric tons per day capacity rice milling factory was commissioned in Kano State.
•
The St. Gabriel coconut oil refinery, a multi-billion-naira, with a one million daily coconut processing capacity with 3,000 staff,
was inaugurated in Akwa Ibom State.
•
The Dangote Fertilizer Plant, which has the capacity to produce three million tons of urea and ammonia annually, built on a
500 hectares of land in the Lekki Free Trade Zone at a total cost of US$2.5 billion, was commissioned.
•
The Dangote Fertilizer Limited commenced the training of over one million farmers for the next three years on the best
practices in fertilizer application to boost productivity.
•
The Alliance for Green Revolution in Africa (AGRA), a consortium of agriculture support organisations, inaugurated a training
programme for 300,000 smallholder farmers in Kaduna State. The project would support farmers on crop value chain, with
focus on maize, soybeans, and tomatoes by strengthening their entrepreneurial skills and market participation.
•
The National Agricultural Land Development Authority (NALDA) trained 200 Young Farmers in Israel and Morocco on crop
production and animal husbandry.
•
The Federal Ministry of Agriculture and Rural Development (FMARD), in collaboration with the Nigerian Institute for Oil Palm
Research (NIFOR), trained oil palm farmers on pest and soil fertility management in Edo State. The Ministry also distributed
200 oil palm fruit harvesting chisel and 1000 litres of organic path-away fertilizers to the farmers during the training.
•
A 10,000-hectare commercial oil palm plantation owned by JB Farms Limited was inaugurated in Ondo State. The project is
expected to employ at least 10,000 direct and 30,000 indirect workers throughout its value chain.
•
The Ondo State Government announced the sum of N2.00 billion to support the production of oil palm in the state, and
allocated 70,000 hectares of land to investors for palm oil and cocoa production.
•
The Oyo State Government launched the Tede Agri Industrial Cluster in Tede community of Oke-Ogun area of the state, located
on 10,000 hectares of arable land, with infrastructure such as a dam and a housing scheme.

Livestock
•
The Kano State Agro-Pastoral Development Project (KSADP) announced an investment of N10.93 billion for agro-pastoral
projects in the 2022 fiscal year, which consists of 9.0 per cent for crops and the legume value chain interventions for smallholder farmers across the state.

Fisheries
•
The Norwegian Government, through the Norwegian Seafood Council, carried out a capacity training for fishery officers and
stakeholders in Lagos.

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Box 1: Policy Support and Developments in the Real Sector Cont...

Sector
Developments

Gas
•
The Board of Directors of the Nigerian Liquefied Natural Gas Limited (NLNG) approved the supply of 100.0 per cent of the
company's Liquefied Petroleum Gas (LPG) production (Propane and Butane) to the Nigerian market.
•
The Nigerian National Petroleum Company (NNPC) limited, Shell, Nigerian Agip Oil Company (NAOC) Limited, Total Energies
and the Gas Aggregation Company of Nigeria (GACN) signed a Gas Sale and Aggregation Agreement (GSAA) to supply 70 million
standard cubic feet (mscf) of gas to Dangote Fertilizer Company.
•
The NNPC Ltd. and energy infrastructure conglomerate, Sahara Group took delivery of two sets of 23,000 Coal Bed Methane
(CBM) to Liquefied Petroleum Gas (LPG), with plans to add 10 vessels in the next few years to enhance Africa’s transition to
cleaner fuels.
•
A consortium of three companies namely; Falcon Corporation, ND Western Midstream Limited and FHN Gas Limited, were
selected to build, exclusively own and operate a natural gas distribution infrastructure network within the Lagos Free Trade
Zone (LFTZ).

Solid
Minerals
•
The Federal Government announced the auctioning of the National Integrated Mineral Exploration Project (NIMEP). The
proceeds would be domiciled in a revolving fund to carry out more exploration activities across the country.

Industry
•
The Bank of Industry and Bayelsa State Government unveiled a N2.00 billion Micro Small and Medium Enterprises (MSMEs)
matching development fund to support entrepreneurs.
•
The Bank of Industry and the United Nations Industrial Development Organisation (UNIDO) also partnered to improve the
nation’s industrial energy efficiency.
•
The Federal Government, through the National Automotive Design and Development Council (NADDC) announced floating a
N200.00 billion vehicle financing scheme.
•
The Central Bank of Nigeria partnered with the African Export-Import Bank, Deutsche Gesellschaft fur international
Zusammenarbeit (GIZ) to roll out a ‘factoring’ programme as an alternative financing instrument for micro, small and medium
enterprises.
•
The Federal Government signed an Interconnected Mini-grid Acceleration Scheme (IMAS) grant agreement with eight
indigenous solar mini-grid developers for the development of 23 mini-grids across 11 States of the Federation.
•
The FEC approved ₦5.14 billion contract for the design, supply and installation of 1x60MBA, 132×33 KV transmission substation, with associated 4×132 KV line bay extension in Adamawa State.

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Box 1: Policy Support and Developments in the Real Sector Cont...

Sector
Developments

Transport
•
The Senate passed a bill to amend the Federal Airports Authority Act.
•
The Federal Executive Council (FEC) approved:
•
₦5.40 billion for the construction of an access road from Mpape to Shere-Galuwyi Resettlement Housing
Scheme in Bwari area council of the FCT;
•
₦52.80 billion for the completion of three road projects that cuts across Akwa Ibom, Abia, Imo, Kwara and
Cross River states;
•
₦115.40 billion for the dualisation of Kano-Kazaure-Kongolam highway in Katsina State under the Tax Credit
Scheme;
•
US$2.81billion for the procurement of rolling stocks and other operational and maintenance equipment for
the Ibadan-Kano and Port Harcourt-Maiduguri rail lines;
•
₦56.30 billion for the completion of the Abaji-Koton Karfe section of the Abuja-Lokoja highway;
•
Upward review of the Afo-Apoto-Oyo Boundary road, Kwara State, from ₦3.06 billion to ₦3.31 billion;
•
₦36.10 billion for the rehabilitation of Keffi-Nasarawa-Toto road in Nasarawa State;
•
₦169.70 billion for the reconstruction of three roads in Kebbi and Niger States and one in Taraba State under
the Tax Credit Scheme;
•
₦90.80 billion for road rehabilitation in Taraba State and procurement of control tower radio communication
systems for 12 airports - located in Akure, Benin, Calabar, Ibadan, Ilorin, Jos, Minna, Owerri, Sokoto, Yola,
Kaduna and Enugu - and instrument landing systems in Lagos, Abuja, Katsina and Port Harcourt airports
•
US$329.00 million was approved for Consultancy Supervision Services of various railway projects in the country; including
the Abuja to Warri rail project, Port Harcourt-Maiduguri railway, and the Kano-Katsina-Jibia-Maradi rail-line
•
₦250.00 billion proceeds of the 2021 Sukuk issuance was allotted to fund road infrastructure across the six geopolitical
zones and the FCT.
•
Six Nigerian Airlines - Air Peace, Azman Air, United Nigeria Airline, Arik Air, Aero Contractors and Max Air- signed a deal
to form an alliance, called Spring Alliance. The objective of the alliance was to curb flight delays among the six partners,
provide technical support to each other and reduce flight schedule disruptions by ensuring that passengers are airlifted
by any of the members, irrespective of which partner airline’s ticket the passengers possess.
•
The proposed Nigeria Air received the Air Transport License (ATL) from the Nigerian Civil Aviation Authority (NCAA),
authorising it to provide scheduled and non-scheduled service. The ATL certification precedes the Air Operator's
Certificate (AOC), which empowers the airline to operate scheduled commercial flights.

Health
•
The Federal Government received 3.2 million doses of the Pfizer COVID-19 vaccines from the U.S Government.
•
The Japanese Government donated 859,600 doses of AstraZeneca COVID-19 vaccines to Nigeria, through the COVID-19
Vaccines Global Assess Facility, COVAX, and 4,400,000 doses of Johnson & Johnson COVID-19 vaccines was donated by
the Government of Spain.
•
The President signed the National Health Insurance Authority (NHIA) Act into law. The Act empowers the NHIA to ensure
provision of mandatory health insurance for all Nigerians in collaboration with state health insurance agencies, and
stipulates the establishment of a new fund to provide subsidy for health insurance coverage for vulnerable persons in
the country.
•
Following the re-emergence of Monkeypox disease, the NCDC activated a national multisectoral Emergency Operations
Centre for Monkeypox (MPX-EOC) to strengthen and coordinate ongoing response activities in-country.

Environment
•
The Federal Government unveiled a National Biosecurity Policy and Action Plan for 2022 - 2026, to secure the health of
Nigerians and their immediate environment from biological threats. The framework includes instruments and activities
that analyse and manage risks in food safety, animal life and health, plant life and health.

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Development Financing
The Bank sustained its development finance
interventions in the critical sectors of the
economy to improve access to credit, ensure price
stability, and support job creation and economic
recovery. A total of 240 projects, including 1
state-based project, and 95,091 individuals and
businesses benefited from 17 intervention
programmes by the Bank, in the review period.
The interventions included the disbursement of
N69.13 billion to 51 projects, under the 100-for100 policy on production and productivity (100
for 100 PPP) to enhance productivity and
improve foreign exchange earnings.
Also, in complementing efforts at mitigating the
challenges in the power sector, a total of N34.37
billion was disbursed to eight discos, under the
Nigeria Electricity Market Stabilization Facility
(NEMSF - 2). Furthermore, 16,569 electricity
meters were distributed nationwide in the first
half of 2022, via the National Mass Metering
Programme (NMMP).
Cumulative
repayments
from
the
Bank’s
intervention programmes rose by 67.3 per cent
to N471.82 billion from N282.30 billion in the
preceding half. The increase reflected an
increased drive for loan-recovery and positive
returns on the programmes.

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Table 3.2.7: Some Selected
Disbursements on Interventions in the H1-2021 and H1-2022


H1-2021
H2-2021
H1-2022 *

Disbursements
Repayments
Disbursements
Repayments
Disbursements
Repayments

Amount
(N Billion)
Beneficiaries
Amount
(N Billion)
Amount
(N Billion)
Beneficiaries
Amount
(N Billion)
Amount
(N Billion)
Beneficiaries
Amount
(N Billion)
Agricultural Credit Guarantee Scheme
(ACGS)
2.17
9,719 loans
guaranteed
1.75
3.75
21,974 Loans
Guaranteed
2.01
3.21
13,194 Loans
Guaranteed
2.14
Commercial Agricultural Credit
Scheme (CACS)
16.25
11 projects
20.01
13.27
12 Projects
48.14
28.30
12 Projects
32.86
Anchor Borrowers' Programme
179.35
1,008,457
farmers
47.49
246.67
384,617
farmers
196.48
35.52
28,875 farmers
42.99
Accelerated Agriculture Development
Scheme (AADS)
1.50
1 State
governmentsponsored
projects
0.25
0.036
1 State
governmentsponsored
projects
5.31
1.50
1 State
governmentsponsored
projects
4.37
Maize Aggregation Scheme (MAS)
0.35
2 Projects
N/A
Nil
Nil
Nil
Nil
Nil
Nil
Paddy Aggregation Scheme (PAS)
4.17
1 Project
Nil
Nil
Nil
4.67
6.20
3 Projects
Nil
Presidential Fertilizer Initiative (PFI)
Nil
Nil
2.50
Nil
Nil
2.75
Nil
Nil
3.00
National Food Security Programme
(NFSP)
Nil
Nil
8.31
Nil
Nil
2.30
Nil
Nil
2.03
Real Sector Support Facility Using
Differentiated Cash Reserve Ratio
(RSSF-DCRR)
199.69
32 Projects
1.97
476.30
39 Projects
0.08
210.29
34 Projects
18.50
COVID-19 Intervention for
Manufacturing Sector (CIMS)
35.99
16 Projects
N/A
Nil
Nil
Nil
413.84
50 Projects
12.00
Non-oil Export Stimulation Facility
(NESF)
Nil
Nil
0.58
1.76
Nil
3.88
Nil
Nil
2.00
Micro, Small and Medium Enterprises
Development Fund (MSMEDF)
0.05

beneficiaries
2.91
0.69
Nil
2.82
Nil
Nil
2.52
Agribusiness/Small and Medium
Enterprises Investment Scheme
(AGSMEIS)
9.79
1,067
beneficiaries
0.135
22.92

Beneficiaries
1.16
1.60
2,720
Beneficiaries
0.008
Creative Industry Financing Initiative
(CIFI)
0.07

beneficiaries
0.013
0.26

Beneficiaries
0.25
Nil
Nil
0.28
Targeted Credit Facility (TCF)
144.93
323,654
beneficiaries
N/A
69.91
64,008
Nil
24.37
50,302
Beneficiaries
Nil
Nigeria Youth Investment Fund (NYIF)
2.81
6,763
N/A
0.88
Nil
2.62
Nil
Nil
0.28
Healthcare Sector Intervention Facility
(HSIF)
25.16
23 Projects
N/A
11.06
23 Projects
Nil
17.21
11 Projects
Nil
Healthcare Sector Research &
Development Intervention (Grant)
Scheme (HSRDIS)
0.15

beneficiaries
N/A
0.03
-
Nil
0.02
-
Nil
National Mass Metering Programme
(NMMP)
36.04
393,702
N/A
11.79
346,401
N/A
0.20
16,569
Nil
Nigeria Electricity Market Stabilization
Facility (NEMSF - 2)
120.29
7 DisCos
5.91
96.72
8 DisCos
N/A
34.37
8 DisCos
Nil
Nigeria Bulk Electricity Trading –
Payment Assurance Facility (NBET-PAF)
88.99
1 Project
N/A
301.36
1 Project
Nil
26.93
1 Project
322.87
Solar Connection Facility (SCF)
7.00
100,000 SHS
N/A
0.00
Nil
Nil
0.00
Nil
Nil
Intervention Facility for Nigeria Gas
Expansion Programme (IFNGEP)
15.20
2 Projects
N/A
24.00
4 Projects
-
26.00
4 Projects
Nil
Tertiary Institution Entrepreneurship
Scheme (TIES)


0.03

Beneficiaries
Nil
0.26

Beneficiaries
Nil
100FOR100 Policy on Production and
Productivity (100FOR100 PPP)


51 Projects
1.32
Youth Entrepreneurship Development
Programme (YEDP)


Nil
Nil
0.001
Nil
Nil
0.12
Power and Airline Intervention Facility
(PAIF)

Nil
6.56
Nil
Nil
15.91
Textile Sector Intervention Facility (TSIF)
0.39
1 Project
-
0.90
3 Projects
3.27
Nil
Nil
8.62
Private – Accelerated Agricultural
Development Scheme (P-AADS)


Nil
Nil
Nil
Nil
Nil
Nil
Export Facilitation Initiative (EFI)


-
-
Nil
36.00
5 Projects
Nil
Export Development Facility (EDF)


-
-
Nil
17.08
15 Projects
Nil

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3.3 FISCAL DEVELOPMENTS
The Medium-Term Fiscal Policy Framework
The focus of fiscal policy in the first half of 2022
was to address the challenges of low economic
growth, insecurity, inadequate public service
delivery, and significant infrastructure deficits.
These objectives were anchored on the 2022
Appropriation Act (as amended), the MediumTerm Expenditure Framework & Fiscal Strategy
Papers 2022-2024 (MTEF/FSP 2022-2024), and
the Medium-Term Debt Strategy 2020-2023
(MTDS 2020-2023).
In the first half of 2022, low oil revenue earnings
continued to weigh on federation revenue at both
the federal and subnational levels, amid
increased government spending. Consequently,
the fiscal deficit in the first half of 2022 expanded
to 6.3 per cent of GDP, while the public debt, at
the end of June 2022, stood at 23.7 per cent of
GDP, below the 40.0 per cent MTDS threshold.
Federation Account Operations
Federation Revenue
Revenue projections in the review period were
hinged on oil parameters and non-oil reforms,
envisaged in the 2022 Appropriation Act. Oil
price was benchmarked at US$73.00 per barrel
and domestic crude oil production at 1.60 million
barrels per day (mbpd). The amendment of
relevant tax laws through the 2021 Finance Act,
particularly, the taxation of digital activities with
significant economic presence, boosted non-oil
revenue target. Revenue-enhancing measures,

2 Earnings lodged in the Federation Account by virtue of Section 161 of the
Federal Republic of Nigeria Constitution 1999 as amended.
such as leveraging technology through ecollections and cost-saving measures such as the
service-wide implementation of the Integrated
Payroll and Personnel Information System (IPPIS)
were expected to boost revenue outcomes.
Key Budget Parameters and Projections

Source: 2022 Appropriation Act, (revised)

Revenue outcomes in the first half of 2022
declined, relative to the level in the second half of
2021, due to a high cost of value shortfall
recovery for PMS and low domestic crude oil
production. At N5,519.86 billion or 6.0 per cent of
GDP, provisional gross federally collected
revenue2 declined by 3.5 per cent relative to the
level in the second half of 2021. However, it rose

•1.60 mbpd
Daily oil production
•US$73.00
Crude oil price
•N410.15/US$
Exchange rate
•4.2 %
GDP growth
•13.0 %
Inflaiton rate
Deficits
N7.35 Trillion
Expenditure
N17.32 Trillion
Revenue
N9.97 Trillion

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by 9.6 per cent relative to the first half of 2021
and fell short of the 2022 proportionate budget
by 41.3 per cent. The shortfall was attributed,
largely, to the significant payment of value
shortfall recovery for
premium motor spirit (PMS), which outweighed
the benefit of oil earning, despite the high global
crude oil prices.

Figure 3.3.1: Structure of Federation Revenue (per cent)
Sources: Federal Ministry of Finance, Budget and National Planning
(FMFB&NP) and Office of the Accountant General of the
Federation (OAGF).

Improvement in revenue outcome, relative to the
first half of 2021, was driven by non-oil revenue,
which accounted for 62.0 per cent of total
federation
earnings,
while
oil
earnings
constituted the balance of 38.0 per cent. This
compared with the ratio of 49.5:50.6 (non-oil and
oil) revenue ratio in the 2022 Appropriation Act.

The
robust
non-oil
revenue
performance
reflected early gains from the government’s
diversification effort aided by the Strategic
Revenue Growth Initiatives (SRGIs) and the
Finance Act 2021. In contrast, the contribution of
oil continued to be dampened by the high value
shortfall recovery for PMS and low domestic
crude oil production despite rising crude oil
prices.

Table 3.3.1: Federally Collected Revenue and Distribution
(N Billion)
Sources: Federal Ministry of Finance, Budget, and National
Planning (FMFB&NP)


1st Half

2nd Half

1st Half

Budget
Federation Revenue
(Gross)


Oil


Crude Oil & Gas Exports


PPT & Royalties


Domestic Crude Oil/Gas Sales


Others


Non-oil


Corporate Tax


Customs & Excise Duties


Value-Added Tax (VAT)


Independent Revenue of Fed.
Govt.


Others*


Total
Deductions/Transfers*


1,717.99

1,661.98

1,915.85
2,298.45
Federally Collected Rev
(Net)
Less Deductions &
Transfers**


Plus:


Additional Revenue


125.30


170.30


303.99

104.88

Excess Oil Revenue


Excess Non-Oil Revenue


Exchange Gain


Total Distributed
Balance


Federal Government


1,348.73


1,736.14


1,473.96


3,054.53

State Governments


1,088.41


1,282.07


1,255.39


2,073.23

Local Governments


805.28


954.82


925.35


1,554.52

13% Derivation


200.03


255.58


253.30


520.65


1st Half 2021
2nd Half 2021
1st Half 2022
Oil Revenue
Non-Oil Revenue

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Drivers of Federally Collected Revenue
•
Non-oil Revenue
A gradual recovery in the domestic economy,
stirred by improved economic activities and
higher independent revenue, led to a favourable
non-oil revenue outcome. Non-oil revenue at
N3,424.52 billion (3.7 per cent of GDP), rose by
16.7 per cent relative to the first half of 2021. The
improvement, relative to the level in the first half
of 2021, reflected improved performance in nonoil revenue sources, particularly company income
tax, customs and excise duties and value-added
tax. Despite the rise in non-oil receipts, relative to
the first half of 2021, they fell below the levels in
the second half of 2021 and the proportionate
target by 1.1 per cent and 26.3 per cent,
respectively.

Figure 3.3.2: Composition of Non-Oil Revenue (per cent)
Sources: Federal Ministry of Finance, Budget and National Planning
(FMFB&NP) and Office of the Accountant General of the Federation
(OAGF).

•
Oil Revenue
Despite the sustained rise in crude oil prices at the
international market, oil receipt declined, relative
to 2021 and the target for 2022. At N2,095.34
billion (2.3 per cent of GDP), oil revenue was 0.2
per cent and 7.2 per cent, below receipts in the
first and second halves of 2021. It was also below
the proportionate budget of N4,750.21 billion by
55.9 per cent. The low revenue was attributed to
high value shortfall recovery for PMS and low
domestic crude oil production occasioned by oil
theft and pipeline vandalism.

Figure 3.3.3: Composition of Oil Revenue (per cent)

Source: Federal Ministry of Finance, Budget and National Planning
(FMFB&NP) and Office of the Accountant General of the
Federation (OAGF).


Deductions
From the gross revenue of N5,519.86 billion in
the first half of 2022, statutory deductions from
oil and non-oil revenues, as well as transfers,
amounted to N1,915.85 billion, leaving a net
distributable balance of N3,907.99 billion.
Allocations to the three tiers of government
Gross allocation to the three tiers of government
rose by 13.5 per cent, due, majorly, to increased
Federation revenue, relative to the first half of
2021. However, the disbursement was 7.6 per
cent and 45.7 per cent short of allocations in the
second half of 2021 and the half year budget,
respectively.
The
shortfall
in
federation
allocation, and low independent revenue
exacerbated fiscal pressure at the central and
subnational levels, in the review period.


PPT &
Royalties
81.5%
Domestic
Crude Oil &
Gas Sales
16.2%
Others
2.3%
Company
Income Tax
28.3%
Customs &
Excise Duties
23.0%
ValueAdded Tax
34.5%
FGN
Independent
Revenue
13.7%
Other
Transfers
0.5%

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Figure 3.3.4: Distribution to the Three Tiers of Government
and 13% Derivation Fund (N Billion)

Source: Federal Ministry of Finance, Budget and National Planning
(FMFB&NP) and Office of the Accountant General of the Federation
(OAGF).

Structure of Tax Revenue
Analysis of the structure of federation revenue
with a focus on tax performance, indicates
sustained growth in the contribution of taxes to
federation earnings since the first half of 2021.
Tax revenue accounted for 85.2 per cent of total
federation revenue in the first half of 2022,
compared with 78.0 per cent and 75.8 per cent in
the second and first halves of 2021, respectively.
Income tax (consisting Petroleum Profit Tax (PPT)
and Company Income Tax (CIT)) remained the
main driver of tax revenue in the period,
accounting for 57.4 per cent.
Tax revenue-to-GDP at 5.1 per cent, was above
the levels in the first and second halves of 2021
at 4.8 per cent and 4.6 per cent, respectively. In
comparison with an average of 16.6 per cent in
30 African countries3, Nigeria’s tax revenue-toGDP during the period was below the average.


3 Revenue Statistics in Africa OECD 2021.

Figure 3.3.5: Structure of Tax Revenue

Note: PPT includes royalties, thus overstating its contribution.
Sources: Federal Ministry of Finance, Budget and National Planning
(FMFB&NP) and Office of the Accountant General of the Federation
(OAGF).

Figure 3.3.6: Composition of Tax Revenue
Sources: Staff computation using data from the Federal Ministry of
Finance, Budget and National Planning (FMFB&NP) and Office of the
Accountant General of the Federation (OAGF).
Note: Income tax consists of CIT and PPT. However, PPT includes
royalties, which might overstate PPT contribution.

FG
SG
LG
13%
Half Year
Benchmark
2022H1
2021H2
2021H1

2 0 2 1 H 1
2 0 2 1 H 2
2 0 2 2 H 1
B U D G E T
Billion Naira
Income tax
VAT
Trade tax
58.2%
27.3%
14.5%
2021H1
60.1%
22.9%
17.0%
2021H2
57.6%
25.4%
17.0%
2022H1
66.0%
19.3%
14.7%
2022 Benchmark

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Table 3.3.2: Federation Revenue Structure

2021H1
2021H2
2022H1
Budget
Total revenue

Non-Tax

Tax

Tax Revenue Percentage of:


Federation
revenue

GDP

Income tax

PPT

CIT

Consumption tax

Trade tax

Other Taxes

Note: PPT includes royalties, thus overstating its contribution.
Sources: Staff computation using data from the Federal Ministry of
Finance, Budget and National Planning (FMFB&NP) and Office of the
Accountant General of the Federation (OAGF).

Fiscal Operations of the Federal Government

FGN Retained Revenue
Retained revenue of the FGN fell, occasioned by
declines in statutory receipts from the Federation
Account
and
FGN
independent
revenue.
Provisional FGN retained revenue, at N2,319.48
billion (2.6 per cent of GDP), declined by 14.5 per
cent and 48.8 per cent, relative to the levels in
the second half of 2021 and the 2022 half year
budget, respectively. It however rose above the
receipt in the first half of 2021 by 1.4 per cent.
The development was due to the low receipts
from the Federation Account, driven by low
crude oil production.


Table 3.3.3: FGN Retained Revenue (N Billion)

2021H1
2021H2
2022H1
Budget
FGN Retained
Revenue

Federation
Account

VAT Pool
Account

FGN
Independent
Revenue

Excess Oil
Revenue

Excess Non-Oil

Exchange Gain

Others*

Sources: Federal Ministry of Finance, Budget and National Planning
(FMFB&NP) and Office of the Accountant General of the Federation
(OAGF)
Note*: Includes Transfers from Special Levies Accounts, FGN’s share
of Signature Bonus, Domestic Recoveries, Stamp Duty, Grants and
Donor Funding and Share of NLNG Dividend.

Federal Government Expenditure
Provisional aggregate expenditure of the FGN in
the first half of 2022 rose substantially, amid
rising interest payment obligations. At N8,042.32
billion (8.9 per cent of GDP), provisional
aggregate expenditure of the FGN exceeded the
levels in the first and second halves of 2021 by
38.7 per cent and 27.2 per cent, respectively. The
increase reflected new spending priorities to
grow the economy, as well as huge interest
payment obligations.
Recurrent expenditure, at N5,176.67 billion (5.7
per cent of GDP), accounted for 64.4 per cent of
total expenditure, while capital expenditure and
transfers recorded 30.4 per cent and 5.2 per cent,
respectively.

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Table 3.3.4: FGN Expenditure (N Billion)

2021H1
2021H2
2022H1
Half Year
Benchmark
Aggregate
Expenditure

Recurrent

of which:


Personnel
Cost

Pension and
Gratuities

Overhead
Cost

Interest
Payments

Domestic

External

Special
Funds

Capital
Expenditure

Transfers


Source: CBN Staff Estimate


Source: Staff Estimate

Figure 3.3.7: Composition of Federal Government
Expenditure (per cent)

Sources: Office of the Accountant General of the Federation
(OAGF) and Staff estimates

With regards to the capital budget releases and
utilisation by MDAs, the Office of the National
Security Adviser (ONSA), Interior, Works &
Housing, Power, and Aviation ranked highest,
while Education, Transport and Trade &
Investment ranked least. On average, 50.3 per
cent of capital releases was utilised in the first
half of 2022
Figure 3.3.8: Expenditure performance (per cent)

Sources: Federal Ministry of Finance, Budget and National Planning
(FMFB&NP) and Office of the Accountant General of the Federation
(OAGF).


Federal Government Fiscal Balance
The fiscal operations of the Federal Government
in the first half of 2022 recorded a deficit of 6.3
per cent of GDP, driven largely, by low revenue
outcome amid rising debt service obligations.
Provisional overall fiscal deficit at N5,722.84
billion rose by 63.1 per cent, 58.5 per cent and
84.4 per cent, relative to the levels in the first and
second halves of 2021, and proportionate
budget, respectively. This reflected the persistent
revenue challenge, amid an upsurge in spending
obligations. The deficit was financed from both
domestic and external sources.
Recurrent
66.4%
Capital
28.4%
Transfers


Table 3.3.5: Economic Classification of
Government Expenditure
First Half 2022

Expenditure
(=N=billion)
Percentage share

Admin.
Economic
services
Social and
community
services
Transfers
Recurrent

Capital

Transfers


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Table 3.3.6: Federal Government Fiscal Operations
(N Billion)


2021H1
2021H2
2022H1
Half Year
Benchmark
Retained
revenue

Aggregate
expenditure

Primary
balance

Overall
balance

GDP
(Nominal)

Deficit-toGDP (%)

Source: CBN Staff Estimates from available data
Note: * 2022 Figures are provisional, ** Estimate based on the
4.4% GDP growth rate forecast in the 2022 Appropriation Act


Figure 3.3.9: Federal Government Fiscal Operations
(N Billion)
Sources: Federal Ministry of Finance, Budget and National Planning
(FMFB&NP) and Office of the Accountant General of the Federation
(OAGF).
Note: revenue and expenditure figures are provisional


Public Debt Strategy and Sustainability
Total Public Debt
Following new borrowings from domestic and
external sources, majorly, for the financing of
infrastructural facilities and legacy liabilities,
public debt levels were elevated but remained
below the threshold of 40.0 per cent of the GDP in
the MTDS4.
Total public debt outstanding, constituting
Federal and State governments’ debt obligation,
at end-June 2022, stood at N42,845.88 billion or
23.4 per cent of the GDP and represented an
increase of 8.3 per cent and 20.8 per cent above
the levels at end-December 2021 and end-June
2021, respectively. The increase was attributed
to new borrowings to fund part of the 2022
budget, settle the inherited arrears of the FGN to
State governments, oil marketing companies,
exporters, and local contractors.


Table 3.3.7: Total Public Debt (N Billion)
Type
2021H1
2021H2
2022H1
External Debt
13,710.88
15,855.23
16,615.66
Of which:


FGN
11,845.63
13,884.76
14,723.46
States & FCT
1,865.24

1,970.47
1,892.20
Domestic Debt
21,754.13
23,700.80
26,230.22
Of Which:


FGN
17,631.80
19,242.56
20,948.94
States & FCT
4,122.32
4,458.24
5,281.28
Total
35,465.01
39,556.03
42,845.88
Source: Debt Management Office.


42020-2023 Medium-Term Debt Strategy framework

2021H1
2021H2
2022H1
Budget
Expenditure
Revenue
Fiscal Balance

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The consolidated debt stock of the Federal
Government
(including
State
governments’
external debt, which forms part of the FGN’s
contingent liability), at end-June 2022, was
N37,564.61 billion or 20.5 per cent of the GDP,
while State governments’ domestic debt stock
accounted for the balance of N5,281.28 billion or
2.9 per cent of the GDP. As a ratio of total public
Debt, FGN debt stock accounted for 87.7 per cent
and the balance of 12.3 per cent was held by state
governments.
Federal Government Debt Profile
•
Debt Strategy
FGN borrowing in the review period was guided by
the 2020-2023 MTDS, which stipulates the
borrowing limits, optimal debt portfolio mix, costrisk and other considerations towards ensuring
debt sustainability.

Table 3.3.8: Revised MTDS Targets
Source: MTDS 2020-2023, Debt Management Office.

•
FGN Debt Stock and Composition
A breakdown of the FGN debt showed that
domestic debt stood at N20,948.94 billion (55.8
per cent), while external debt was N16,615.66
billion (44.2 per cent). FGN Bond issues
maintained its dominance, accounting for 72.5 per
cent of the total domestic debt, followed by
Treasury Bills (21.5 per cent), FGN Sukuk (2.9 per

5 Composed of Treasury Bonds (0.4%), Green Bonds (0.1%) and FGN
Savings Bond (0.1%)
cent), Promissory Notes (2.5 per cent), and others5
(0.6 per cent).
Figure 3.3.10: Composition of FGN Debt Stock (N
Billion)
Source: Debt Management Office.
Holdings of Nigeria’s external debt indicates that
Multilateral, Commercial and Bilateral loans
accounted for 47.8 per cent, 39.0 per cent and
11.7 per cent, respectively, while ‘other’ 6 loans
constituted 1.5 per cent.
Figure 3.3.11: Composition of External Debt Stock by
Holders

Source: Compiled from Debt Management Office figures.

•
Debt Service
The consolidated debt service payments of the
Federal Government, at end-June 2022, was
N1,870.80 billion. The sum of N1,333.41 billion
6 Promissory Notes

2021H1
2021H2
2022H1
Local Currecy Denominated Debt
Foreign Currecy Denominated Debt
Multilateral
47.8%
Bilateral
11.7%
Commercial
39.0%
Others
1.5%
Indicator
Targets
Targets
2016-2019
2020-

Fiscal Sustainability: Total Public
Debt as % of the GDP
Max. 25%
Max. 40%
Portfolio Composition:


Domestic: External Debt Mix
Max.60:
Min.40
Max.70:
Min.30
Refinancing Risk: Average Tenor of
Debt Portfolio
Min. 10
years
Min. 10
years
Long-Term: Short-Term
Min.75:
Max.25
Min.75:
Max.25
Domestic Debt Mix

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was paid to domestic creditors, while external
creditors received N537.39 billion.

Figure 3.3.12: Breakdown of Total Debt Service
(N Billion)
Source: Debt Management Office

Sub-National Government Fiscal Analysis
State Governments and FCT Finances
Revenue
Improvement in non-oil earnings resulted in higher
statutory receipts by state governments. At
N1,508.69 billion, state governments’ gross
allocation increased by N220.25 billion or 17.1 per
cent, relative to the level in the first half of 2021.
The increase was due, largely, to significant
improvement in VAT and Non-oil excess receipts.
Relative to the level in the second half of 2021,
however, non-oil revenue declined by N28.95
billion or 1.9 per cent.
Outstanding liabilities of state governments
amounted to N277.25 billion7 and was deducted
from states’ Federation Account receipts, leaving
a net balance of N1,231.44 billion for distribution
to the state governments. The allocations
constituted: Federation Account (Statutory),

7 These arise from state governments’ contractual obligations,
including their contribution to external debt service fund, payments
N853.78 billion (56.6 per cent); VAT Pool Account,
N550.27 billion (36.5 per cent); Non-oil Excess
N101.10 billion (6.7 per cent); and Exchange Gain,
N3.53 billion (0.2 per cent).
Expenditure
Further analysis shows that total provisional
aggregate expenditure by state governments rose
by 6.5 per cent to N2,853.31 billion in the first half
of
2022,
from
N2,677.90
billion
in
the
corresponding period of 2021. However, relative
to the level in the second half of 2021, total
expenditure fell by 5.0 per cent (N149.11 billion).
Capital expenditure at N1,202.12 billion fell by
12.1 per cent (N166.04 billion), relative to the level
in the preceding period of 2021. At N1,652.10
billion, recurrent expenditure maintained its
dominance of total expenditure, accounting for
57.9 per cent in the review period.
Figure 3.3.13: Composition of State Governments and
FCT’s Revenue First Half 2022 (per cent)

Source: Sources: Federal Ministry of Finance, Budget and National
Planning (FMFB&NP), Office of the Accountant General of the
Federation (OAGF) and Staff Estimates


for fertiliser, State Agricultural Project, National Fadama Project and
the National Agricultural Technology Support Programme.


1,000
1,500
2,000
2021H1
2021H2
2022H1
External
Domestic
Total
Federation
Acct
56.6%
VAT
36.5%
Excess NonOil
6.7%
Exchange
Gain
0.2%

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Figure 3.3.14: Composition of State Governments and
FCT’s Expenditure, First Half 2022 (per cent)

Source: Federal Ministry of Finance, Budget and National Planning
(FMFB&NP), Office of the Accountant General of the Federation (OAGF) and
Staff Estimates
Local Government Finances
The revenue profile of local governments was
enhanced by improved collections in the VAT Pool
Account. Total allocations to the 774 local
governments from the Federation Account in the
first half of 2022 was N925.35 billion. This was
14.9 per cent higher than the level in the first half
of 2021. However, it was 3.1 per cent and 40.5 per
cent lower than the second half of 2021 and the
budget, respectively. Dynamics in the Federation
Account
earnings
dictated
the
revenue
performance of the subnational unit.
Gross allocation comprised receipts from the
Federation Account, N463.75 billion (50.1 per
cent); VAT, N385.19 billion (41.6 per cent); non-oil
excess revenue, N74.49 billion (8.1 per cent); and
exchange gain, N1.92 billion (0.2 per cent).


Table 3.3.9: Subnational Government Revenue (N
Billion)


2021H1
2021H2
2022H1
Benchmark
State
Governments


Local
Governments


Derivation


State

Allocation
(N’Billion)

% of Total


2021H1
2021H2
2022H1
Top 3
Lagos


Delta


Rivers

Bottom 3
Ekiti


Kwara


Nassarawa


Local

Allocation
(N’Billion)

% of Total


2021H1
2021H2
2022H1

Top 3
Lagos


Kano


Oyo

Bottom 3
Ebonyi


Gombe


Bayelsa

Source: Staff compilation from Sources: Federal Ministry of Finance,
Budget and National Planning (FMFB&NP) and Office of the
Accountant General of the Federation (OAGF).

Local governments in Lagos, Kano and Oyo states
received the highest allocations in the period at
N75.06 billion (8.1 per cent), N51.14 billion (5.3
per cent), and N37.67 billion (4.1 per cent); while
Ebonyi, Gombe and Bayelsa states ranked least
receiving 1.6 per cent, 1.4 per cent and 1.2 per
cent of the total allocation to the 774 local
governments, respectively.
Capital Exp
42.1%
Recurrent
Exp
57.9%

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Figure 3.3.15: Composition of Statutory Allocations to
Local Governments, First Half 2022 (per cent)
Source: Sources: Federal Ministry of Finance, Budget and National
Planning (FMFB&NP) and Office of the Accountant General of the
Federation (OAGF).
3.4 FINANCIAL DEVELOPMENTS

Monetary and Credit Developments
The
Bank
maintained
an
accommodative
monetary policy stance for most part of the review
period, to support growth. However, the need to
tame inflationary pressures and encourage foreign
capital inflow prompted a switch to a hawkish
policy stance in the later part of the review period.

Reserve Money
Reserve money grew in the first half of 2022 on
account of increased liabilities to other depository
corporations.
Required
reserves
of
other
depository corporations (ODCs) surged by 8.5 per
cent at end-June 2022, triggered by penal debits
on banks that defaulted on the minimum Loan to
Deposit Ratio requirement. This propelled a 6.4
per cent growth in liabilities to ODCs, in contrast
to the decline of 2.3 per cent and 6.0 per cent
recorded in the preceding half and corresponding
period of 2021, respectively.


Table 3.4.1: Reserve Money (N Billion)

Jun-20
Dec-20
Jun-21
Dec-21
Jun-22
Reserve
Money

Currency
in
Circulation
2,300.83

2,908.46

2,741.26

3,325.16

3,255.56

Notes and
Coins

2,300.83


2,908.46


2,741.26

3,324.21
3,254.20
eNaira

Liabilities
to ODCs

Source: Central Bank of Nigeria
Consequently, reserve money grew by 4.3 per
cent to ₦13,860.27 billion in the first half of 2022,
compared with 1.4 per cent in the preceding half
year, but was in contrast to the decline of 5.9 per
cent in the corresponding period of 2021. On the
contrary, currency in circulation (CIC), declined by
2.1 per cent in the first half of 2022, compared
with the decline of 5.8 per cent in the
corresponding period of 2021, but was in contrast
to a growth of 14.3 per cent in the preceding half.
The decline in CIC was attributed to the
implementation of the cashless policy and
increase in e-payment, which rose by 237.8 per
cent in the first half of 2022 compared with the
corresponding period of 2021.
Figure 3.4. 1: Reserve Money (N Billion)

Source: Central Bank of Nigeria


Jun-20
Dec-20
Jun-21
Dec-21
Jun-22
CIC

LODCs
10,944.5 10,199.46 9,592.59
9,969.99 10,784.29
RM
13,245.3 13,107.92 12,333.85 13,295.15 13,860.27
N' Billion
VAT
41.6%
Exchange
Gain
0.2%
Federation
Account
50.1%
Non-Oil
Excess
8.1%

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Figure 3.4.2: Currency-Reserve Deposit Ratio and
Broad Money Multiplier

Source: Central Bank of Nigeria

Broad Money Supply
Broad money (M3) grew above its benchmark in
the first half of 2022, driven by net domestic assets
(NDA). The growth in loans to the central
government by depository corporations and the
rise in claims on private sector resulted in an
increase in net claims on central government and
claims on other sectors. Net claims on central
government and claims on other sectors grew by
31.6 per cent and 12.4 per cent, compared with
the growth of 20.4 per cent and 16.8 per cent in
the preceding half year, and 0.9 per cent and 9.2
per cent in the corresponding period of 2021,
respectively. Consequently, NDA grew by 21.9 per
cent in the first half of 2022, the same level of
growth in the preceding half year, but lower than
11.9 per cent in the corresponding period of 2021.
Foreign loans and non-residents’ deposits with
depository corporations increased in the review
period, leading to a 29.6 per cent surge in liabilities
to non-residents. Resultantly, net foreign assets
(NFA) fell by 34.7 per cent, compared with 18.7
per cent decline in the corresponding period of
2021, as against the growth of 4.2 per cent in the
preceding half year.
The growth in NDA outweighed the decline in NFA,
occasioning an increase in broad money supply
(M3) by 10.0 per cent (annualised at 20.0 per cent)
Table 3.4.2: Growth in Money Assets & Liabilities
to N48,890.24 billion in the review period,
compared with the benchmark of 14.9 per cent for
the fiscal year.

Drivers of Growth in Monetary Assets
Growth in broad money supply was driven,
majorly, by the contribution of domestic claims.
Net domestic assets of the banking system at
N42,789.31 billion, grew by 21.9 per cent and
contributed 17.3 percentage points to the growth
in broad money supply. Domestic claims grew by
17.8 per cent to N57,448.24 billion, and
contributed 19.6 percentage points to the growth

Jun.

Dec
-20
Jun-

Dec
-21
Jun-

Broad Money
Multiplier
2.70 2.97 3.20 3.34 3.53
Currency/Depos
it Ratio
6.08 7.06 6.14 7.08 5.89
Per Cent

Jun 20
Dec 20
Jun 21
Dec 21
Jun 22
NFA

DC

Net claims on
Government

Claims on


Other Sectors

Other
financial
corporations

21.89

7.98

(1.89)

(5.34)

2.91
State and
local
government

Public
nonfinancial
corporations

Private sector

Broad
money
Liabilities

Currency
outside
depository
corporations

(7.63)

23.38

(9.91)

17.74

(7.46)
Transferable
deposits

Other
deposits

Securities
other than
shares

Source: Central Bank of Nigeria

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in money supply, compared with 18.9 and 7.3
percentage points in the preceding half and
corresponding period of 2021, respectively.

Net claims on central government grew by 31.6
per cent, due to increase in depository
corporation’s claims on central government. Thus,
net claims on central government contributed 9.8
percentage points to the growth in broad money
supply in the first half of 2022, compared with 6.0
percentage points in the preceding half.

Similarly, claims on other sectors rose by 12.4 per
cent to N39,233.61 billion in the review period,
compared with the growth of 16.8 per cent and
9.2 per cent in the preceding half year and the
corresponding period of 2021, respectively. This
was driven, largely, by the growth of 42.4 per cent,
29.9 per cent, and 12.8 per cent in claims on public
nonfinancial corporations, on states and local
governments, and private sector, respectively.
Consequently, claims on other sectors contributed
9.8 percentage points to the growth in broad
money supply in the first half of 2022, compared
with 12.9 and 7.0 percentage points in the
preceding half-year and the corresponding period
of 2021, respectively.


Table 3.4. 2: Growth in Monetary Assets and Liabilities
Consumer Credit
The value of consumer credit extended by Other
Depository Corporations (ODCs) declined as a
result of the hike in the monetary policy rate. The
rising trend in consumer credit in most part of the
first half of 2022, was reversed with a rise in the
policy rate in May. The rising lending rates resulted
in
lower
demand
for
consumer
credit.
Consequently,
consumer
credit
outstanding
declined by 6.8 per cent to N1,933.18 billion, from
N2,073.76 billion in the preceding half of 2021.
However, there was an improvement, compared
with N1,840.24 billion in the corresponding period
of 2021.


Jun 20
Dec 20
Jun 21
Dec 21
Jun 22
NFA

DC

Net claims on
Government

Claims on


Other Sectors

Other
financial
corporations

21.89

7.98

(1.89)

(5.34)

2.91
State and
local
government

Public
nonfinancial
corporations

Private sector

Broad
money
Liabilities

Currency
outside
depository
corporations

(7.63)

23.38

(9.91)

17.74

(7.46)
Transferable
deposits

Other
deposits

Securities
other than
shares

Source: Central Bank of Nigeria

CENTRAL BANK OF NIGERIA
Half Year Economic Report, 2022
This document is for CBN internal consumption
This document is for CBN internal consumption
Consumer credit constituted 4.9 per cent of total
claims on other sectors, compared with 5.9 per
cent and 5.6 per cent in the preceding half and the
corresponding period of 2021, respectively.

Figure 3.4.3: Consumer Credit and its Share of Claims
on Other Sectors

Source: Central Bank of Nigeria
Credit Utilisation by Sectors
Unwavering effort by the Bank to increase
productivity and output spurred growth in sectoral
credit, particularly in the services and industry
sectors. Sustained implementation of the LDR
policy,
coupled
with
the
Bank’s
critical
intervention drives, engendered considerable
growth in sectoral credit allocation to key sectors
of the economy. Sectoral credit allocation stood at
₦26,846.40 billion at end-June 2022, representing
an increase of 10.1 per cent and 22.6 per cent,
relative to the ₦24,378.19 billion and ₦21,895.31
billion at end-December 2021 and end-June 2021,
respectively.
Of the total credit allocated, services sector
sustained its dominance, as it grew by 12.4 per
cent and accounted for 54.5 per cent, relative to
53.3 per cent and 52.4 per cent at end-December
2021 and end-June 2021, respectively. The share
of industry sector was also significant at 39.4 per
cent, albeit lower than the 40.7 per cent and 42.3
per cent recorded at end-December 2021 and
end-June 2021, respectively. The Agriculture
sector recorded the lowest share of 6.1 per cent,
though, higher than the 6.0 per cent and 5.3 per
cent in the preceding half year and the
corresponding period, respectively.
Table 3.4.3: Sectoral Credit Allocation

Jun-21
Dec-21
Jun-22
Agriculture
5.3
6.0
6.1
Industry
42.3
40.7
39.4
of which
Construction
5.0
4.4
4.4
Services
52.4
53.3
54.5
of which
Trade/General
Commerce
6.3
7.0
7.1
Source: Central Bank of Nigeria
Maturity structure of Banks’ Claims and Liabilities
Short-term credit accounted for the bulk of banks’
loan portfolio. Banks sustained preference for
short-term loans, as credit with maximum
maturity of one year accounted for 55.7 per cent
at the end of the first half of 2022, relative to 16.2
per cent and 28.1 per cent for bank credit with
medium-term and long-term tenors, respectively.
Similar trend was observed at the end of the
preceding and corresponding periods, as shortterm bank credit also formed the bulk of banks’
loan portfolio, accounting for 56.4 per cent and
51.3 per cent, respectively.


Jun. 20
Dec-20
Jun-21
Dec-21
Jun-22
Per cent
₦' Billion
Total Consumer Credit
Share of Claims on Other Sectors

CENTRAL BANK OF NIGERIA
Half Year Economic Report, 2022
This document is for CBN internal consumption
This document is for CBN internal consumption

Figure 3.4.4: Distribution of Bank Loans and Advances
by Maturity

Source: Central Bank of Nigeria
Banks deposit structure depicted similar trend as
short-term deposit of less than one-year maturity
accounted for 90.0 per cent, relative to 89.9 per
cent and 89.8 per cent at end-December 2021 and
the corresponding period of 2021, respectively.
The medium and long-term deposits accounted
for 5.0 per cent apiece of the total deposit. The
preference for short-term deposits over the
longer-term
deposits
was
driven
by
macroeconomic uncertainties and inherent risks
in the economy.
Figure 3.4.5: Maturity Structure of Bank by Deposits

Source: Central Bank of Nigeria


Market Structure of the Banking Industry
The concentration ratio of the banking system in
terms of assets improved, while the concentration
ratio in terms of deposits remained unchanged.
The review of the banking industry indicated that
six banks in terms of assets had a concentration
ratio of 61.2 per cent, an improvement compared
with 66.2 per cent and 66.4 per cent in the
preceding half and corresponding period of 2021,
respectively.
In
terms
of
deposits,
the
concentration ratio of six of the largest banks
remained at 68.8 per cent, the same as in the
corresponding period of 2021. The composition of
the six banks remains unchanged over time.
However, there was no dominance of a single bank
for both deposits and assets.
Figure 3.4.6: Market Concentration Ratios of Banks
(Assets and Deposits) December 2019 to June 2022

Source: Central Bank of Nigeria

The Herfindahl-Hirschman Index (HHI) of 954.53
(on a scale of 100 to 10,000) in deposits and
933.89 in assets reflects competitiveness in the
banking system and allays concerns about the
possibility of unhealthy dominance in the system.
Nonetheless, the HHI position for both deposits
and assets show a slight increase relative to the
corresponding half year position of 936.66 and

Dec 19
Jun 20
Dec 20
Jun 21
Dec 21
Jun 22
Per cent (%)
Short-term
Medium-term
Long-term

Dec 19
Jun 20
Dec 20
Jun 21
Dec 21
Jun 22
Per cent
Short-term
Medium-term
Long-term

Dec-19
Jun-20
Dec-20
Jun-21
Dec-21
Jun-22
CR 6 (Deposits)
CR 6 (Assets)
CR (Largest Deposits)
CR (Largest Assets)

CENTRAL BANK OF NIGERIA
Half Year Economic Report, 2022
This document is for CBN internal consumption
This document is for CBN internal consumption
907.93, and preceding half year of 847.43 and
854.24, respectively.
Figure 3.4.7: Measures of Competition in Banks:
Herfindahl-Hirschman Index December 2019 to June

Source: Central Bank of Nigeria

Financial Soundness
Nigeria’s financial sector remained resilient,
despite
heightened
global
and
domestic
uncertainties. At end-June 2022, the industry
Capital Adequacy Ratio (CAR) fell to 14.1 per cent,
from 14.6 per cent and 15.5 per cent at endDecember 2021 and end-June 2021, respectively.
The development was attributed to the increase in
risk-weighted assets of banks, which more than
offset the increase in their total qualifying capital.
The ratio, however, remained above the minimum
regulatory benchmark of 10.0 per cent.
Analysis of bank asset quality measured by the
ratio of non-performing loans (NPLs) to gross total
loans stood at 5.0 per cent at end-June 2022,
relative to 4.9 per cent at end-December 2021,
and 5.7 per cent at end-June 20v21. The NPL ratio
was at par with the 5.0 per cent prudential
requirement.
The Industry Liquidity Ratio (LR) declined by 0.6
percentage point to 54.2 per cent, from 54.8 per
cent at end-December 2021, reflecting a decrease
in the stock of liquid assets held by banks.
However, it indicated a significant increase of 12.9
percentage points, compared with 41.3 per cent
at end-June 2021, but remained above the
regulatory benchmark of 30.0 per cent.

Developments in Other Financial Institutions
To deepen access to financial services and promote
inclusive growth, the Bank issued licences to new
Other Financial Institutions (OFIs). The total
number of OFIs at end-June 2022 was 6,697,
relative to the 6,682 and 6,620 at end-December
2021 and end-June 2021, respectively. The
increase in the number of OFIs was attributed to
the issuance of nine new Microfinance Banks
licenses and six Finance Companies (FCs).
There were 875 licensed MFBs at end-June 2022,
comprising 9 National MFBs, 134 State MFBs, and
732 Unit MFBs; compared with the 866 and 875
MFBs at end-December 2021 and end-June 2021,
respectively. The number of FCs in operation also
increased to 106 at end-June 2022, compared with
100 at end-December 2021 and 91 at end-June
2021.

The number of operating Primary Mortgage Banks
(PMBs) remained at 34 at end-June 2022,
comprising 12 national PMBs and 22 state PMBs.
The number was the same with that of endDecember 2021.


Dec-19
Jun-20
Dec-20
Jun-21
Dec-21
Jun-22
HHI
HHI (Deposits)
HHI (Assets)

CENTRAL BANK OF NIGERIA
Half Year Economic Report, 2022
This document is for CBN internal consumption
This document is for CBN internal consumption
Table 3.4.4: Breakdown of Other Financial Institutions
S/N
Type
No. of
Institutions
at end-June,

No. of
Institutions
at endDecember,

No. of
Institutions
at end-June,

Microfinance
Banks:

Unit

State

National

Bureaux De
Change
5,613
5,675
5,675

Finance
Companies

Development
Finance
Institutions

Primary
Mortgage Banks

State

National

Total
6,620
6,682
6,697
Source: CBN

Development Finance Institutions
The
total
assets
of
development
finance
institutions (DFIs) increased, due, largely to the rise
in cash and bank balances. At the end- of June
2022, the total assets of the seven DFIs was
N3,334.06 billion, an increase of 9.2 per cent and
6.9 per cent above the levels at end-December
and end-June 2021, respectively. The rise resulted
from increased bank balances, placements,
investments and fixed assets. The increased asset
was financed through accretion to reserves,
increased borrowings and shareholders’ fund.
Further analysis of the total assets by institution
indicated that BOI (Bank of Industry), DBN
(Development Bank of Nigeria), Federal Mortgage
Bank of Nigeria (FMBN), Nigerian Export-Import
Bank (NEXIM), NMRC, Bank of Agriculture (BOA)
and The Infrastructural Bank (TIB) accounted for
59.8 per cent, 14.9 per cent, 14.5 per cent, 6.5 per
cent, 2.6 per cent, 1.7 per cent and 0.1 per cent,
respectively. The BOI, DBN, FMBN, NEXIM, BOA
and NMRC accounted for 48.8 per cent, 20.1 per
cent, 19.3 per cent, 8.5 per cent, 1.8 per cent and
1.6 per cent, of the total net loans and advances,
respectively.

Table 3.4.5: Other Financial Institutions Consolidated
Balance Sheet
ASSETS
Jun-21
Dec-21
Jun-22
N'000
N'000
N'000
Cash & Bank Balances
71,991,694
966,032
22,002,218
Placements
526,751,221
428,810,530
466,507,297
Investments
1,002,362,306
909,038,807
1,121,464,031
Net Loans & Advances
1,385,949,576
1,585,391,610
1,598,617,094
Other Assets
65,861,932
67,871,628
60,525,133
Fixed Assets
64,825,466
62,248,045
64,943,907
Total Assets
3,117,742,195
3,054,326,652
3,334,059,680
Financed By:


Paid-up Capital
238,780,740
238,780,740
238,780,740
Reserves
183,476,959
214,459,492
232,891,187
Shareholders' fund
422,257,699
453,240,232
471,671,927
Deposits
484,008,966
514,848,997
558,363,855
Borrowings
1,767,218,636
1,582,320,992
1,886,720,548
Due to Other Banks
93,513
11,415,214
2,927,389
Other Liabilities
393,220,299
438,596,675
371,031,896
Long-term Liabilities
50,943,082
53,904,542
43,344,065
Total Capital &
Liabilities
3,117,742,195
3,054,326,652
3,334,059,680
Source: Central Bank of Nigeria

CENTRAL BANK OF NIGERIA
Half Year Economic Report, 2022
This document is for CBN internal consumption
This document is for CBN internal consumption
Table 3.4.6: Development Finance Institutions
Consolidated Balance Sheet
ASSETS
Jun-21
Dec-21
Jun-22
N'000
N'000
N'000
Cash & Bank
Balances
303,240,800
227,365,705
263,824,378
Placements
816,378,530
671,072,047
708,544,239
Investments
1,114,391,867
1,015,708,474
1,231,449,913
Net Loans &
Advances
2,532,381,772
2,930,059,195
3,023,609,148
Other Assets
248,727,814
236,664,533
249,145,506
Fixed Assets
161,244,028
142,791,342
170,071,913
Total Assets
5,176,364,811
5,223,661,296
5,646,645,097
Financed By:


Paid-up Capital
468,505,050
466,876,723
498,230,745
Reserves
182,538,492
219,591,851
235,691,426
Shareholders' fund
651,043,542
686,468,574
733,922,171
Deposits
1,034,846,107
1,106,788,532
1,186,557,994
Borrowings
1,988,247,548
1,819,868,498
2,125,758,380
Due to Other Banks
30,762,607
49,566,894
157,941,082
Other Liabilities
875,449,945
862,519,135
920,530,197
Long-term Liabilities
596,015,062
698,449,663
521,935,273
Total Capital &
Liabilities
5,176,364,811
5,223,661,296
5,646,645,097
Source: Central Bank of Nigeria

The total assets of OFIs, excluding the BDCs, was
N5,646.65 billion at the end of June 2022. This was
9.1 per cent and 8.1 per cent above N5,176.36
billion and N5,223.66 billion, recorded at the end
of December 2021 and the end of June 2021,
respectively. Net loans and advances at N3,023.61
billion was 3.2 per cent and 19.4 per cent above
the N2,930.06 billion and N2,532.38 billion at endDecember 2021 and end-June 2021, respectively.
At N1,231.45 billion, investments increased by
21.2 per cent and 10.5 per cent, compared with
N1,015.71 billion and N1,114.39 billion at endDecember 2021 and end-June 2021, respectively.
Similarly, fixed assets at N170.07 billion at endJune 2022, reflected an increase of 19.1 per cent
and 5.5 per cent above the levels at endDecember 2021 and end-June 2021, respectively.

Deposits at N1,186.56 billion was 7.2 per cent and
14.7 per cent above the levels at end-December
2021 and end-June 2021, respectively. Borrowings
amounted to N2,125.76 billion at end-June 2022,
an increase of 16.8 per cent and 6.9 per cent,
compared with the N1,819.87 billion and
N1,988.25 billion at end-December 2021 and endJune 2021, respectively. Similarly, “due to other
banks” increased by 218.6 per cent and 413.4 per
cent to N157.94 billion at end-June 2022, relative
to the N49.57 billion and N30.76 billion, at endDecember 2021 and end-June 2021, respectively.
Shareholders’ fund amounted to N733.92 billion,
an increase of 6.9 per cent and 12.7 per cent
relative to N686.47 billion and N651.04 billion at
end-December

and
end-June
2021,
respectively. The increase in shareholders’ funds
was due to increase in paid-up capital and
accretion to reserves.

Microfinance Banks
Assets of MFBs increased due to rise in net loans
and advances, fixed assets and investment. Total
assets of the MFBs rose by 8.3 per cent and 15.1
per cent to N1,408.58 billion at end-June 2022,
from N1,301.11 billion and N1,223.89 billion at
end-December

and
end-June
2021,
respectively. The increase was, due, largely, to the
increase in cash, short-term investments and net
loans & advances. The asset gap was financed,
largely, through increased borrowing, accretion to
reserves and injection of capital in compliance
with the April 2022 recapitalisation deadline.

CENTRAL BANK OF NIGERIA
Half Year Economic Report, 2022
This document is for CBN internal consumption
This document is for CBN internal consumption
Table 3.4.7: Microfinance Banks Consolidated Balance
Sheet
Asset
Jun-21
Dec-21
Jun-22

N'000
N'000
N'000
Cash
12,423,556
16,698,439
32,744,108
Balances
with Banks
171,812,729
156,482,263
151,276,444
Placements
181,514,459
126,448,501
127,669,383
Short term
Investments
22,552,229
21,563,298
32,033,882
Long Term
Investments
6,084,727
6,383,322
7,381,753
Net Loans
and
Advances
738,999,456
901,660,358
955,227,381
Other Assets
62,748,789
57,217,332
66,799,279
Fixed Assets
27,750,852
14,652,379
35,449,116
Total Assets
1,223,886,797
1,301,105,892
1,408,581,346
Financed by


Paid-up
Capital
93,286,276
93,733,391
119,260,260
Reserves
50,852,705
66,125,223
54,573,548
Shareholders'
Fund
144,138,981
159,858,614
173,833,808
Deposits
367,965,481
411,737,651
453,989,534
Takings from
Other Banks
16,281,708
16,584,837
133,925,243
Long Term
Loans/Onlending
464,873,270
448,434,925
390,356,047
Other
Liabilities
230,627,357
264,489,865
256,476,714
Total
liabilities
1,223,886,797
1,301,105,892
1,408,581,346
Source: Central Bank of Nigeria


Table 3.4.8: Finance Companies Consolidated Balance
Sheet
Asset
Jun-21
Dec-21
Jun-22

N'000
N'000
N'000
Cash
2,000,757
2,374,221
2,233,223
Balances with
Banks
22,195,104
27,320,315
27,670,496
Placements
37,760,193
41,886,472
37,021,246
Investments
20,038,776
19,756,834
12,756,583
Net Loans
and Advances
142,694,415
166,975,827
181,798,627
Other Assets
59,558,128
58,150,597
66,198,625
Fixed Assets
49,184,041
46,151,221
49,792,007
Total Assets
333,431,414
362,615,487
377,470,807
Financed by:


Paid-up
Capital
27,715,587
25,653,669
29,404,116
Reserves
20,009,092
15,185,826
17,780,420
Shareholders'
Funds
47,724,679
40,839,495
47,184,536
Long Term
Liabilities
3,233,191
1,852,173
1,940,146
Total
Borrowings
221,028,912
237,547,506
239,037,832
Other
Liabilities
61,444,632
82,376,313
89,308,293
Total
Liabilities
333,431,414
362,615,487
377,470,807
Source: Central Bank of Nigeria

CENTRAL BANK OF NIGERIA
Half Year Economic Report, 2022
This document is for CBN internal consumption
This document is for CBN internal consumption
Finance Companies
Total assets of FCs increased, due, largely, to rise
in net loans and advances and other assets. Total
assets of finance companies increased to N377.47
billion at end-June 2022, an increase of 4.1 per
cent and 13.2 per cent, compared with N362.62
billion and N333.43 billion at end-December 2021
and end-June 2021, respectively. The increase
relative to the level at end-December 2021 was
due to higher net loans & advances and increase
in other assets. The increased loans and advances
was financed through retention of profit, increase
in borrowing, other liabilities, as well as, injection
of additional capital.

Primary Mortgage Banks
The total assets of Primary Mortgage Banks
(PMBs) increased due, mainly, to rise in net loans
and
advances,
balances
with
banks
and
placements. Total assets of the PMBs, at N526.53
billion, reflected an increase of 4.1 per cent and
5.0 per cent relative to N505.61 billion and
N501.30 billion at end-December 2021 and endJune 2021, respectively. The rise in assets was
financed through additional capital injection and
ploughed back profit.


Table 3.4.9: Primary Mortgage Banks Consolidated
Balance Sheet
Asset
Jun-21
Dec-21
Jun-22

N'000
N'000
N'000
Cash
1,090,269
1,478,194
1,670,226
Cash Reserve
Requirement
1,929,603
4,107,915
2,590,795
Balances with
Banks
19,797,088
17,938,326
23,636,868
Placement with
banks
70,352,657
73,926,544
77,346,313
Investments/Noncurrent Assets
Held for Sale
43,638,411
45,411,458
46,623,126
Short Term
Investments
11,498,442
6,884,809
4,388,071
Investment in
Quoted Shares
8,216,976
6,669,946
6,802,467
Net Loans and
Advances
264,738,325
276,031,400
287,966,046
Other Assets
60,558,965
53,424,976
55,622,469
Fixed Assets
19,483,669
19,739,697
19,886,883
Total Assets
501,304,405
505,613,265
526,533,264
Financed by:


Paid-up Capital
108,722,447
108,708,923
110,785,629
Reserves
-71,800,264
-76,178,690
-69,553,729
Shareholders'
Funds
36,922,183
32,530,233
41,231,900
Deposits
182,871,660
180,201,884
174,204,605
Due to
Banks/Others
14,387,386
21,566,843
21,088,450
Long-term
Loans/NHF
76,965,519
77,056,282
86,295,015
Other Liabilities
190,157,657
194,258,023
203,713,294
Total Liabilities
501,304,405
505,613,265
526,533,264
Source: Central Bank of Nigeria

Examination of Other Financial Institutions
The Bank conducted target and Anti-Money
Laundering and combating the Financing of
Terrorism (AML/CFT) examinations on 204 OFIs.
The target examination was conducted on 114
MFBs to ascertain their capital levels in line with
the final re-capitalisation deadline of April 2022.
The onsite AML/CFT examination of 90 OFIs,
excluding Bureaux de Change (BDCs), was to
ascertain the OFIs' compliance with the extant
Money Laundering (ML) and Terrorist Financing
Acts and other applicable regulations. Money

CENTRAL BANK OF NIGERIA
Half Year Economic Report, 2022
This document is for CBN internal consumption
This document is for CBN internal consumption
Laundering and Financing of Terrorism (ML/FT)
risks of the OFIs were evaluated in line with the
GIABA assessment requirements. The outcome of
the examination revealed that more than half of
the OFIs examined were rated “Above Average”.
The
examination,
also,
revealed
various
infractions of extant regulations and erring
institutions were sanctioned appropriately.

Financial Markets
Money Market Developments
Liquidity conditions in the banking system eased,
influencing the downward trend in key money
market rates. The movement in banking system
liquidity was influenced by injections through the
fiscal operations of the government, effects of CRR
debit,
settlement
of
foreign
exchange
interventions, maturity and issuance of CBN bills
and government securities.

Money Market Rates
Money market rates trended southward, following
improved liquidity in the banking system. The
average net industry liquidity balance rose by 44.3
per cent to N200.27 billion from N138.76 billion in
the preceding half of 2021. Consequently, the
weighted average monthly inter-bank call and OBB
rates declined to 9.4 and 8.1 per cent compared
with 10.5 and 12.0 per cent in the second half of
2021, respectively. Similarly, the weighted
average Nigeria Inter-bank Offered Rate (NIBOR
30-day) fell by 2.1 percentage points to 8.8 per
cent.


Table 3.4.10: Money Market Rates, Weighted Average
(per cent).

MPR
Call Rate
OBB Rate
NIBOR
30-days
Jan-21

Feb-21

Mar-21

Apr-21

May-21

Jun-21

Average

Jul-21

Aug-21

Sep-21

Oct-21

Nov-21

Dec-21

Average

Jan-22

Feb-22

Mar-22

Apr-22

May-22

Jun-22

Average

Source: Central Bank of Nigeria

Figure 3.4.8: Money Market Rates (Per cent)

Source: Central Bank of Nigeria

Deposit and Lending Rates
Lending rates leaned towards the tight monetary
policy stance of the Bank. The average prime and
maximum lending rates inched up to 11.9 per cent
and 28.0 per cent in the first half of 2022, from
11.6 per cent and 27.5 per cent in the second half
of 2021, respectively. Compared with the level in
the corresponding half of 2021, the prime lending


10.9

9.4
8.1
8.8

MPR
Call Rate
OBB Rate
NIBOR 30-day
2021H1
2021H2
2022H1

CENTRAL BANK OF NIGERIA
Half Year Economic Report, 2022
This document is for CBN internal consumption
This document is for CBN internal consumption
rate fell by 0.6 percentage point, while the
maximum lending rate rose by the same
magnitude.

Average term deposit rate fell by 0.4 percentage
point to 3.4 per cent, below its level in the second
half of 2021. However, the spread between the
average term deposit and maximum lending rates
between the two periods, widened from 23.7
percentage points to 24.6 percentage points in the
review period. This, however, represented a
decline, compared with 25.9 percentage points in
the corresponding half of 2021.

Figure 3.4.9: Banks Deposits and Lending Rates

Source: Central Bank of Nigeria

Open Market Operations
The Bank continued to use the CBN bills to manage
liquidity in the banking system, boost tradable
securities and deepen secondary market activities
in the first half of 2022. The total amount of CBN
bills issued, amounted to N7,249.61 billion, higher
than N6,323.47 billion recorded in the preceding
half of 2021, but lower than N7,456.08 billion in
the corresponding half of 2021. Total public
subscription and sales stood at N10,856.88 billion
and N7,227.72 billion, compared with N7,342.20
billion and N6,309.02 billion, respectively, in the
preceding half year. For the corresponding period
of 2021, total subscription and sales were
N11,650.75
billion
and
N7,339.03
billion,
respectively.

The high level of activity in OMO in the review
period relative to the level in the preceding period,
reflected improved investors’ confidence in the
money market amid the hawkish monetary policy
stance towards the end of the review period.

Discount Window Operations
Improved net liquidity in the banking system
resulted in the reduction of repo transactions in the
first half of 2022. Total request for repurchase
agreements (repo) transactions fell by 34.7 per
cent to N4,998.12 billion in the first half of 2022,
compared with N7,648.86 billion and N6,410.40
billion in the preceding and corresponding halves
of 2021, respectively. Applicable interest rate in
the review period was 14.0 per cent (±2.5) for the
4-day to 90-day tenors. Total interest earned on
repo transactions declined by 30.8 per cent and
70.5 per cent to N15.89 billion in the first half of
2022, compared with N22.96 billion and N53.83
billion earned in the preceding half year and
corresponding period of 2021, respectively.

Standing Facilities Window
Transactions at the SDF window was consistent
with the level of liquidity in the banking system.
Activities at the Standing Deposit Facility (SDF)
window increased due, largely, to improved
banking system liquidity. The average daily
amount rose to N18.51 billion for the 122
transaction days in the first half of 2022,
compared with N10.11 billion for the 121
transaction days and N15.15 billion for the 120
transaction
days
in
the
preceding
and
corresponding halves of 2021, respectively.

2021H1
2021H2
2022H1
Percentage Points
Per cent (%)
Savings Rate
Average Term Deposit Rate
Prime Lending Rate
Maximum Lending Rate
Spread (MXLR-AVTD) (RHS)

CENTRAL BANK OF NIGERIA
Half Year Economic Report, 2022
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This document is for CBN internal consumption
Consequently, average daily interest payments on
the deposits rose by 92.6 per cent to N3.28 million
in the review period, from N1.70 million and N2.37
million in the preceding and corresponding halves
of 2021.

At the Standing Lending Facility (SLF) window, the
daily average of 81 transactions stood at N55.82
billion in the first half of 2022, as against N 34.41
billion in 99 transactions in the second half of 2021
and N82.74 billion in 109 transactions in the first
half of 2021.

Applicable rates, for the SLF and SDF, anchored on
the MPR, were 12.5 per cent and 4.5 per cent from
January to 23 May 2022; and 14.0 per cent and 6.0
per cent from 24 May to 30 June 2022,
respectively. Comparatively, in the preceding and
corresponding halves of 2021, the applicable rates
for the SLF and SDF were 12.5 per cent and 4.5 per
cent, respectively.

Inter-bank Transactions
Activities in the inter-bank funds market skewed
towards the secured segment, as banks became
risk averse to unsecured lending. The total value of
transactions at the inter-bank funds market stood
at N25,408.36 billion. This represented a decline
of 12.1 per cent and 2.6 per cent, compared with
the N28,893.31 billion and N26,076.17 billion in
the preceding and the corresponding halves of
2021, respectively. At the Open-buy-back (OBB)
segment, transactions increased significantly,
attributed, largely, to the risk averse appetite of
banks for unsecured lending. Consequently,
transactions at the OBB segment stood at
N25,257.84 billion, which accounted for 99.4 per
cent, while the inter-bank call constituted the
balance of 0.6 per cent (N150.52 billion).
Primary Market Activities
Total value of the Nigerian Treasury Bills (NTBs)
issued and allotted in the first half of 2022
amounted
to
N2,415.58
billion
apiece,
representing a decline of 2.2 per cent, below the
level in the preceding half of 2021. Conversely, it
grew by 45.0 per cent, compared with the level in
the corresponding half of 2021. Total value of
public subscription stood at N4,663.18 billion,
compared with N5,116.73 billion and N3,101.23
billion in the preceding and the corresponding
periods of 2021, respectively. The decrease in
public subscription relative to the level in the
preceding period of 2021 was due, mainly, to the
declining yield in treasury bills.

Table 3.4.10 Structure of Outstanding holdings of
Nigeria Treasury Bills

Source: Central Bank of Nigeria

Of the total NTBs allotted, banks and foreign
investors, took up N1,782.22 billion or 73.8 per
cent. Mandate and Internal Funds customers,
including CBN Branches, stood at N564.50 billion
or 23.4 per cent, while merchant banks accounted
for the balance of N68.87 billion or 2.8 per cent.
The successful bid rate in the market were 2.1 per
cent (±0.4) for the 91-day; 3.4 per cent (±0.4), for
the 182-day and 5.2 per cent (±1.3) for the 364day tenors. Successful bid rates in the preceding
period of 2021 stood at 6.2 per cent (±3.8) for the

DMBs
Merchant
Banks
Parastatals
CBN

2021H1
2021H2
2022H1

CENTRAL BANK OF NIGERIA
Half Year Economic Report, 2022
This document is for CBN internal consumption
This document is for CBN internal consumption
91-day, 7.7 per cent (±4.3) for the 182-day and 8.9
per cent (±4.1) for the 364-day tenors.


Figure 3.4.11: Nigerian Treasury Bills Outstanding (N
Billion)

Source: Central Bank of Nigeria

The value of NTBs outstanding at end-June 2022
stood at N4,504.80 billion. This represented a
growth of 19.0 per cent and 50.6 per cent above
N3,786.14 billion and N2,991.87 billion in the
preceding half year and corresponding period of
2021, respectively. Of the total, the share of
commercial improved to 50.5 per cent, compared
with 39.4 per cent and 24.4 per cent in the
preceding and corresponding halves of 2021,
respectively. Mandate customers and Internal
Funds customers was 26.9 per cent, while
merchant banks and CBN, accounted for 0.7 per
cent and 21.9 per cent, respectively, in the review
period.


Over-The-Counter Transactions in NTBs
Over-The-Counter (OTC) transactions in NTBs and
FGN Bonds declined, attributed to low patronage
by foreign and institutional investors. Transactions
in NTBs stood at N22,992.59 billion in the first half
of 2022, indicating a decline of 24.5 per cent
(N7,415.98 billion), compared with its level of
N30,444.57 billion in the first half of 2021.
Similarly, transactions in FGN Bonds stood at
N8,517.85 billion, indicating a decline of 14.2 per
cent below the level of N13,249.67 billion in the
first half of 2021.

Figure 3.4.12: OTC Transactions in the First Half of
2022 (N Billion)

Source: Central Bank of Nigeria

Federal Government of Nigeria Bonds
FGN Bonds valued at N1,125.00 billion were
offered to the public, while subscription, and sale
stood at N2,852.56 billion and N1,805.45 billion,
respectively. The amount offered covered new
issues and reopening of FGN Bonds. In the
preceding half of 2021, FGN Bonds issues,
subscription and allotments amounted to N850.00
billion, N1,630.92 billion and N1,192.01 billion,
respectively. FGN Bonds issues, subscription and
allotment stood at N900.00 billion, N1,726.40
billion and N1,415.00 billion, respectively, in the
corresponding period of 2021. The increase in
issuance was attributed to a shortfall in revenue
earnings.


First Half
Second Half

NTBs
FGN Bonds
First Half 2021
First Half 2022

CENTRAL BANK OF NIGERIA
Half Year Economic Report, 2022
This document is for CBN internal consumption
This document is for CBN internal consumption
The total value of FGN Bonds outstanding at endJune 2022, stood at N15,626.63 billion, compared
with N14,395.75 billion and N13,659.66 billion at
end-December

and
end-June
2021,
respectively. The structure of holdings showed
that 61.0 per cent (N9,531.16 billion) was held by
commercial banks, 0.8 per cent (N132.63 billion)
by merchant banks and the balance of 38.2 per
cent (N5,926.85 billion) was held by the non-bank
public.

Figure 3.4.13: Distribution of FGN Bonds
(End-June 2022, per cent)

Source: Central Bank of Nigeria


Table 3.4.11: Market rates (%) interest spread
Month
Savings
Rate
Ave.
Term
Deposit
Rate
Prime
Lending
Rate
Max.
Lending
Rate
Spread
(Percentage
points)


(2) & (4)
Jan-22

Feb-22

Mar-


Apr-22

May-


Jun-22


H1

Source: Central Bank of Nigeria

Developments in the Capital Market
Activities in the Nigerian equities market were
bullish in the first half of 2022, as the NGX AllShare Index and aggregate market capitalisation
rose, despite volatile global market fundamentals
arising from the Russia-Ukraine war. The bullish
performance
was
due
to
bargain-hunting,
occasioned by the release of positive first quarter
2022 corporate earnings results. Furthermore,
there were 31 new listings in the capital market
during the first half of 2022, compared with 30 and
28 listings in the second and first halves of 2021,
respectively.
The aggregate volume and value of traded
securities on the Exchange rose by 84.8 per cent
and 91.8 per cent to 76.02 billion shares and
N833.41 billion, respectively, in 617,379 deals at
the end of June 2022, compared with 41.13 billion
shares and N434.63 billion in 503,896 deals at
end-December 2021. Similarly, aggregate volume
and value of traded securities at the end of the
first half of 2022 rose by 65.3 per cent and 60.5
per cent, compared with 45.98 billion shares and
N519.25 billion in 555,042 deals at the end of the
corresponding half of 2021. The equities subsector maintained its dominance in the capital
market, accounting for 99.9 per cent and 99.7 per
cent of the aggregate volume and value of
transactions, respectively, while the debt and
Exchange Traded Fund (ETF) segments accounted
for the balance.

The sectoral analysis of the equities segment
indicated that the financial services sector
measured by volume of transactions, remained
the most active, accounting for 54.99 billion
shares or 71.9 per cent, valued at N421.97 billion
38%
62%
Non_Bank Public
DMBs & Merchant

CENTRAL BANK OF NIGERIA
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This document is for CBN internal consumption
or 39.8 per cent, in 296,774 deals or 48.1 per cent
at end-June 2022.
Analysis of activities in the equities segment
showed an increase in participation by domestic
investors, relative to the corresponding and
preceding periods. The levels of domestic and
foreign investors’ participation were 85.4 per cent
and 14.71 per cent, respectively, compared with
77.7 per cent and 22.3 per cent in the preceding
half. Relative to the levels in the corresponding
half, the domestic and foreign investors’
participation stood at 76.8 per cent and 23.2 per
cent, respectively.


Figure 3.4.14: Volume and Value of Traded Equities on
the NGX

Sources: Securities and Exchange Commission (SEC)/Nigerian
Exchange Group (NGX) Limited

NGX All-Share Index
The NGX All-Share Index improved mainly due to
investors’ positive sentiment amid increased
preference for blue-chip stocks. The NGX All-Share
Index stood at 51,817.59 index points at end-June
2022, indicating an increase of 21.3 per cent and
36.7 per cent, relative to the 42,716.44 index
points and 37,907.28 index points at endDecember 2021 and end-June 2021, respectively.
The development was due to the positive
outcomes of the year 2021 and the first quarter of
2022 corporate earnings, which led to increased
investment in blue-chip stocks.
Market Capitalisation
Increased interest in blue-chip stocks, especially in
the telecommunications and financial sectors,
drove market capitalisation. The aggregate market
capitalisation of the 457 listed securities closed at
N50.18 trillion, an increase of 16.4 per cent and
30.8 per cent, relative to the levels at endDecember 2021 and end-June 2021, respectively.
The increase was attributed, mainly, to the rise in
the value of securities across different asset
classes (equities, debt, and ETF), following
improved trading in large and medium capitalised
stocks, occasioned by bargain-hunting and profit-
taking by investors.
Similarly, at N27.94 trillion, market capitalisation
of the 176 listed equities rose by 25.3 per cent and
36.7 per cent at the end of June 2022, compared
with the levels at the end of December 2021 and
end-June 2021, respectively. Listed equities
accounted for 55.7 per cent of the aggregate
market capitalisation, while the debt and ETF
components accounted for the balance of 44.3 per
cent.

The top ten most capitalised companies on the
Exchange accounted for N22.94 trillion or 82.1 per
cent of the total equity market capitalisation and
45.7 per cent of the aggregate market
capitalisation. Two banks made the top ten list,
accounting for N1.29 trillion or 4.6 per cent of the
total equity market capitalisation.

Total market capitalisation, as a percentage of
GDP, stood at 54.9 per cent, in the review period
compared with 43.8 per cent and 47.9 per cent at

First half 2021
Second Half 2021
First Half 2022
Value(N' billion)
Volume (Billion)
Volume of traded securities (LHS)
Value of traded securities (RHS)

CENTRAL BANK OF NIGERIA
Half Year Economic Report, 2022
This document is for CBN internal consumption
This document is for CBN internal consumption
end-December

and
end-June
2021,
respectively. The Warren Buffet Index measured
by the ratio of the value of traded stocks to GDP
was 0.9 per cent, implying that the stock market is
slightly undervalued. The ratio remained, the
same, compared with the 0.9 per cent at endDecember 2021, but was higher when compared
to the 0.6 per cent recorded at end-June 2021.


Figure 3.4.15: All-Share Index and Aggregate Market
Capitalisation

Sources: Securities and Exchange Commission (SEC) and Nigerian
Exchange (NGX) Limited

Primary Market Activities
Activities in the primary segment of the Nigerian
capital market improved in the first half of 2022.
There were 31 new security issuances worth
N2,090.20 billion, compared with 31 and 28
valued at N1,343.30 billion and N1,566.70 billion,
in the preceding and corresponding halves of
2021, respectively. During the review period, one
Initial Public Offering (IPO) worth N111.80 billion,
two public offering valued at N9.90 billion, and
three equity rights issues, worth N2.50 billion,
were approved by the SEC relative to the zeroequity issued in the preceding period. This also
compares with three private placements worth
N13.00 billion and two rights issues worth N7.60
billion in the corresponding period of 2021. In the
government segment of the primary market, 15
FGN Bonds worth N1,555.70 billion and 10
corporate bonds valued at N410.40 billion, were
issued and allotted by the Debt Management
Office (DMO). This compares with 18 FGN Bonds
worth N769.91 billion, 16 corporate bonds valued
at N257.69 billion, and one subnational bond
worth N137.33 billion, issued in the preceding
period of 2021, and 18 FGN Bonds worth
N1,415.00 billion, and five corporate bonds valued
at N131.10 billion in the corresponding period of
2021.

Figure 3.4.16: Value of New Issues by Sector 2022

Source: Securities and Exchange Commission (SEC)/Nigerian
Exchange (NGX) Limited

Institutional Savings
Aggregate financial savings rose by 6.5 per cent
and 24.2 per cent to N28,615.69 billion, from
N26,868.76 billion and N23,044.50 billion at endDecember 2021 and end-June 2021, respectively.
The ratio of financial savings to GDP rose to 31.3
per cent from 28.0 per cent and 28.8 per cent at
the end of the second and first halves of 2021. This
was driven, largely, by high corporate earnings.
Further analysis on financial savings showed that,
banks (Commercial, merchant and non-interest
banks) remained the dominant depository
institutions in the financial system, accounting for

First Half-21
Second Half-21
First Half-22
Naira (billion)
Index
All-Share Index (LHS)
Aggregate Market Capitalisation (RHS)
FGN Bonds
79%
Corporate
Bonds
21%

CENTRAL BANK OF NIGERIA
Half Year Economic Report, 2022
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This document is for CBN internal consumption
95.3 per cent of total financial savings, compared
with 95.2 per cent and 93.7 per cent in the
preceding and corresponding halves of 2021.
Other institutions, comprising, primary mortgage
banks,
microfinance
banks,
life
insurance
companies, pension fund custodians and the
Nigeria Social Insurance Trust Fund (NSITF),
accounted for the balance of 4.8 per cent.

Financial Soundness
Nigeria’s financial sector remained resilient,
despite
heightened
global
and
domestic
uncertainties. At end-June 2022, the industry
Capital Adequacy Ratio (CAR) fell to 14.1 per cent,
from 14.6 per cent and 15.5 per cent at endDecember 2021 and end-June 2021, respectively.
The development was attributed to the increase in
banks’ risk-weighted assets, which more than
offset the increase in their total qualifying capital.
The ratio, however, remained above the minimum
regulatory benchmark of 10.0 per cent.
Analysis of bank asset quality measured by the
ratio of non-performing loans (NPLs) to gross total
loans stood at 5.0 per cent at end-June 2022,
relative to 4.9 per cent at end-December 2021,
and 5.7 per cent at end-June 2021. The NPL ratio
was at par with the 5.0 per cent prudential
requirement.
The Industry Liquidity Ratio (LR) declined by 0.6
percentage point to 54.2 per cent, compared with
54.8 per cent at end-December 2021, reflecting a
decrease in the stock of liquid assets held by
banks. However, it indicated a significant increase
of 12.9 percentage points, compared with 41.3
per cent at end-June 2021, but remained above
the regulatory benchmark of 30.0 per cent.

Developments in Financial System Stability and
Macroprudential Policy
Amid high global and domestic uncertainties
caused by the Russia-Ukraine war and the
downside risks from the resurgence of COVID-19
in China, risks and vulnerabilities to financial
system stability were contained using robust
macroprudential policies.

Solvency Stress Tests and Liquidity Simulations
The banking industry solvency and liquidity
position remained resilient under mild-tomoderate scenarios of sustained economic and
financial conditions but could be vulnerable under
severe scenarios of sustained economic and
financial stress.
Consequently, the banking industry’s resilience
slightly moderated at end-June 2022, compared
with the condition at end-December 2021. The
baseline CAR, LR and NPLs ratio in the review
period were 14.1 per cent, 54.2 per cent and 5.0
per cent, respectively. Return on Asset (ROA) and
Return on Equity (ROE) stood at 2.0 per cent and
17.3 per cent, respectively. The CAR and LR were
above the regulatory benchmarks, while NPLs at
5.0 per cent was within the threshold.

CENTRAL BANK OF NIGERIA
Half Year Economic Report, 2022
This document is for CBN internal consumption
This document is for CBN internal consumption
Table 3.4.12: Banking Industry Baseline Selected Key
Indicators for First Half of 2022

CAR%
LR%
NPLs%
ROA%
ROE%
Jun 2022

Dec 2021

Jun 2021

Percentage
Point(s) Change

Benchmarks
10.0 - 15.0

-
-
Source: Central Bank of Nigeria

Figure 3.4.17: Banking Industry CAR

Source: Central Bank of Nigeria

Credit Risk
The impact of general credit risk shock of 15, 20,
30, 50 and 100 per cent in NPLs could result in a
deterioration of banking industry CAR to 13.64 per
cent, 13.49 per cent, 13.17 per cent, 12.53 per
cent and 10.88 per cent, respectively from the
baseline position of 14.11 per cent. The stress test
revealed that the banking industry could
withstand a credit risk shock of “up to 100.0 per
cent increase” in the industry NPLs, as the CAR
remained
above
the
minimum
regulatory
requirement of 10.0 per cent.


Table 3.4.13: Credit Default Shocks on Banking
Industry CAR (%)
Single Factor Shocks
End-Dec 2021
End-June 2022
Baseline CAR
14.5
14.1
Post-Shock CAR
10% NPLs increase
14.2
13.8
15% NPLs increase

13.6
20% NPLs increase
13.8
13.5
30% NPLs increase
12.7
13.2
50% NPLs increase
10.9
12.5
100% NPLs increase
6.9
10.9
Source: Central Bank of Nigeria

Similarly, the banking industry’s resilience was
demonstrated by the obligor credit concentration
stress test as CAR remained above the minimum
regulatory benchmark of 10.0 per cent under all
three scenarios.
Table 3.4.14: Credit Concentration Risk on Banking
Industry CAR (%)

Dec-21
Jun-22
Baseline CAR
14.8
14.1
Single Factor Credit Concentration Shocks


Scenario 1

13.6
Five largest corporate credit facilities shifted
from pass-through to sub-standard (10%)
Scenario 2
13.3
12.9
Five largest corporate credit facilities shifted
from sub-standard to doubtful (50%)
Scenario 3
12.1
11.6
Five largest corporate credit facilities shifted
from doubtful to lost (100%)
Source: Central Bank of Nigeria


Jun' 19
Dec' 19
Jun' 20
Dec' 20
Jun' 21
Dec' 21
Jun' 22
Per cent

CENTRAL BANK OF NIGERIA
Half Year Economic Report, 2022
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Figure 3.4.18: Credit Concentration Risk for 2022H1
(per cent)

Source: Central Bank of Nigeria

Sector Credit Concentration Risk
Analysis of the banking industry’s total credit by
sector indicated that: Oil and Gas; Manufacturing;
General; Government; General Commerce; and
Agriculture accounted for 22.0 per cent, 16.7 per
cent, 10.7 per cent, 8.8 per cent, 7.4 per cent, and
6.2 per cent, respectively, while others constituted
the balance.

Figure 3.4.19: Sectoral Concentration of Credit
Source: Central Bank of Nigeria

The result of the stress test of the sector credit
concentration indicated that the banking industry
could absorb a shock up to 30.0 per cent in
exposure to oil and gas as the post-shock CAR
stood at 13.4 per cent. A shock of 50.0 per cent
exposure to oil and gas sector, could however,
lead to vulnerability in the banking industry.

Table 3.4.15: Stress Test on Oil and Gas Exposures

Industry CAR (%)
Baseline CAR
14.1
30% Default on total
exposure to Oil and Gas
13.4
50% Default on total
exposure to Oil and Gas
9.7
Source: Central Bank of Nigeria

Interest Rate Risk
The stress test on the net position of interestsensitive assets showed that the banks could
withstand a shock of “up to 1,000 basis points
downward shift in yield curve” as the industry’s
post-shock CAR of 12.1 per cent remained above
the regulatory threshold of 10.0 per cent.

Figure 3.4.20: Net-Position of Interest-Sensitive Assets

Source: Central Bank of Nigeria


Baseline
Scenario 1 (10%)
Scenario 2: Credit
facilities shifted from
Doubtful to Lost
(50%)
Scenario 3: Credit
facilities shifted from
Doubtful to Lost
(100%)
Jun-22
Dec-21
14.1
13.1
12.1
B a s e l i n e C A R
5 0 0 b p s
d o w n w a r d s h i f t i n
y i e l d c u r v e
1 0 0 0 b p s
d o w n w a r d s h i f t i n
y i e l d c u r v e
CAR (%)
Oil and Gas
22%
Manufacturi
ng
17%
Government
9%
General
11%
Gen Comm
7%
Agriculture
6%
Others
28%

CENTRAL BANK OF NIGERIA
Half Year Economic Report, 2022
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Table 3.4.16: Liquidity Stress Test Results (Post-Shock)
Scenario
Banks with
Jun-21
Liquidity Ratios
(LR) < 30%
Dec-21
Jun-22
LR
(%)
Shortfall to 30% LR
threshold
(N’ billion)
Test 1: Implied Cash Flow Test

Day 1

32.7
Nil
Day 2

28.6

Day 3

24.3
1,623.80
Day 4

19.7
2,760.50
Day 5

14.7
3,865.60
Implied Cash
Flow Test
(30 Days)

9.6
4,837.00
Source: Central Bank of Nigeria

Liquidity Stress Test
In the first half of 2022, Implied Cash Flow Analysis
(ICFA) and Maturity Mismatch/Rollover Risk
methods were used in liquidity stress tests to
determine the resilience of individual banks and
the banking industry to funding and liquidity
shocks.
The outcome of the stress test showed that after
a one-day run scenario, the liquidity ratio for the
industry declined from 42.7 per cent baseline
position to 32.7 per cent. Similarly, under the 5day and 30-day scenarios, the liquidity ratio for the
industry declined to 14.7 per cent and 9.6 per
cent, indicating a liquidity position shortfall of
N3.87 trillion and N3.84 trillion, respectively.


Figure 3.4.21: Industry Liquidity Ratios at Periods 1-5
and cumulative 30-day Shocks
Source: Central Bank of Nigeria

Maturity Mismatch
The industry’s baseline assets and liabilities
maturity profile at end-June 2022, showed that
the shorter end of the market (≤90-day bucket)
was adequately funded, showing an excess of
N1,427.74 billion assets over liabilities.

Table 3.4.17: Maturity Profile of Assets and Liabilities
at end-June 2022

Source: Central Bank of Nigeria
The System-wide Maturity Mismatch Analysis
(Test 2A) revealed that the banking industry was
adequately funded, except for above 3-years
bucket, while the industry had mismatches of
N5,639.50 billion (Test 2B) and N7,833.49 billion
(Test 2C). These represented decrease of
N1,270.00 billion (Test 2B) and N1,300.00 billion

Pre-Shock After Day

After Day

After Day

After Day

After Day

After cum
30 days
Per cent
Dec-20
Jun-21
Dec-21
Jun-22
Bucket
Liabilities
Assets
Mismatch
Cumulative
Mismatch
N Billion
≤30 days

days

days

days

1-3 years

>3 years

Total
47,020.48
48,44.23
-1,427.74

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(Test 2C), relative to the test carried out at endDecember 2021.

Table 3.4.18: Test Results for System-wide Maturity
Mismatch at end-June 2022

Test 2A[1]
Test 2B[2]
Test 2C[3]

N ‘billion
No of banks
with
mismatch
N ’billion
No of
banks
with
mismatch
N ’billion
No of banks
with
mismatch
≤30 days
18,704.88

11,915,.10

-36.96

31-90 days
6,380.16

-287.84

-175.46

91-180days
2,966.75

-2,636.89

-495.59

181365days
2,355.37

-3,281.88

-484.58

1-3 Years
1,957.03

-3,989.71

-1,248.85

Above

years
-2,071.54

-7,358.27

(5,392.04))

Total
30,292.64

-5,639.50

-7,833.49

1[1] Note: Test 2A: Descriptive Maturity Mismatch with no consideration for rollover.
1[2] Test 2B: Static Rollover risk Analysis with no closing of liquidity gaps in other buckets.
1[3] Test 2C: Dynamic Rollover risk test with use of liquid assets to close liquidity gaps in other buckets.
Source: Central Bank of Nigeria

Contagion Risk Analysis
Contagion risk analysis indicated rising exposure
and
interconnectedness
(via
interbank
placements and takings). Total exposure rose to
N597.49 billion at end-June 2022, representing
49.0 per cent increase from the N352.86 billion
recorded at end-December 2021.
Six banks accounted for N387.30 billion or 64.8 per
cent of total placements and N432.14 billion or
72.3 per cent of total takings. The exposures were
within the safety corridor of the interbank market
operations and did not signal significant threat to
financial system stability, as all placements were
secured.


Figure 3.4.22: Network Analysis based on Interbank
Exposures


Source: Central Bank of Nigeria


Node colour representation
Blue
= Lenders,
Deep Blue= Net Placement
Red
= Borrowers
Purple= Net Takings

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Box 2: Liquidity Stress Test Assumptions
Implied Cash Flow Analysis
The Implied Cash Flow Analysis (ICFA) assessed the ability of the
banking system to withstand unanticipated substantial withdrawals of
deposits, short-term wholesale and long-term funding over 5 days and
cumulative 30 days, with specific assumptions on fire sale of assets.
The test assumed gradual average outflows of 3.8 per cent, 5.0 per cent
and 1.5 per cent of total deposits, short-term and long-term funding,
respectively, over a 5-day period and a cumulative average outflow of
22.0 per cent, 11.0 per cent and 1.5 per cent of total deposits, shortterm and long-term funding, respectively, on a 30-day balance. It also
assumed that the assets would remain unencumbered after a fire sale.


Item
No

Assets
% Unencumbered
1.
Cash and cash
equivalents

2.
Current account with
CBN

3.
Government bonds,
treasury bills and other
assets with 0% riskweighting
66.5
4.
Certificates of deposit
held
66.5
5.
Other short-term
investments

6.
Collateralized placements
and money at call

7.
CRR

The Maturity Mismatch/Rollover Risk
This approach assessed funding maturity mismatch and rollover risk
for assets and liabilities in the 1-30- and 31-90-day buckets, with
assumptions of availability of funding from the CBN and intra-group
as described below:
• Test 2a: Descriptive Maturity Mismatch assumed that
the baseline mismatch remained, but 5.0 per cent of total deposits
would be made available from the CBN and the intra-group;
• Test 2b: Static Rollover Risk assumed that 80.0 and 72.0
per cent of the funding in the 1-30- and 31-90-day buckets would
be rolled over, with no possibility to close the funding gap from other
buckets. However, 5.0 per cent of the total deposits would still be
available from the CBN and the intra-group; and
• Test 2c: Dynamic Rollover Risk made the same
assumption as in 2b, but with the option of closing the liquidity
gap from other buckets.

Source: Central Bank of Nigeria

8 The CRMS is a regulatory tool designed to capture credit records
and mitigate credit risk in the banking system
Credit Risk Management System
The CBN sustained its regulatory oversight to
ensure that banks fully comply with the redesigned
Credit Risk Management System (CRMS) 8 to
strengthen credit administration in Nigeria. The
CBN CRMS database continued to serve as a
veritable source of credit information in the
Nigerian banking industry. The number of credit
facilities on the CRMS database increased by 10.0
per cent and 22.2 per cent to 32,134,238 at endJune 2022 from 29,213,129 and 26,292,020
recorded at end-December 2021 and end-June
2021, respectively, due to increased credit by
banks. The number of credit/facilities reported on
the CRMS database comprised 31,206,335
individuals and 927,903 non-individuals.
The total number of credit/facilities with
outstanding balances on the CRMS database
declined by 6.8 per cent and 12.8 per cent to
4,563,136 at end-June 2022 from 4,898,075 and
5,233,014 at end-December 2021 and end-June
2021. This comprised 4,365,111 individuals and
198,025 non-individuals.
Private Credit Bureaux
The number of licensed Private Credit Bureaux
(PCBs) remained at three, same as that of endDecember 2021 and end-June 2021. At end-June
2022, the average number of uniquely identified
credit records in the database of the three credit
bureaux stood at an average of 62.17 million,
indicating an increase of 6.78 million, compared
with 55.39 million at end-December 2021.

The average number of uniquely identified credit
records in the database of the PCBs increased by

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30.6 per cent compared with the 47.59 million
recorded at end-June 2021. The increase was
attributed, mainly, to the growth in credit in the
banking sector, increased level of coverage of the
credit reporting system, and awareness of the role
of credit bureaux in the management of credit risk
among stakeholders and the public. This also
explained the 6.4 per cent increase in the average
number of subscribers in the database of the
three-private credit bureaux at end-June 2022.

Table 3.4.19: Credit Records in the Databases of the
Bureaux at end-June 2022
S/N

CRC Credit
Bureau Ltd
CR Services
Credit
Bureau Plc
First Central
Credit
Bureau Ltd

Number of
credit
records
66,732,752
64,100,565
55,681,214

Value of
Credit
Facilities
(N’Tn)


36.84
27.65
33.63

Number of
borrowers
27,892,377
17,842,523
20,323,840

Number of
subscribers
1,667

1,394
Source: Central Bank of Nigeria


Compliance
Developments
and
Consumer
Protection
Financial Sector Surveillance
The Bank maintained its supervisory and surveillance
activities in the banking sector, towards promoting a
safe, stable, and sound financial system. These
activities included the offsite appraisal of banks’
periodic returns, regular onsite assessments (routine
examinations and special investigations) and
issuance of circulars and guidelines.


Financial
Crimes
Surveillance/Anti-Money
Laundering/Combating the Financing of Terrorism
and Countering (AML/CFT/CPF)
Based on the Mutual Evaluation Report (MER)
conducted in 2019, which was adopted by the
plenary of the Inter-Governmental Action Group
Against Money Laundering in West Africa (GIABA)
in August 2021, which placed Nigeria on the
Enhanced Follow-Up process, requiring the
country to make progress reports on efforts
toward addressing the deficiencies noted in the
MER. Some significant milestones achieved
included:
• the commencement of the National Inherent
Risks Assessment;
• enactment of three Anti-Money Laundering
Laws: (1) Anti-Money Laundering (Prevention
and Prohibition) Act, 2022; (2) Terrorism
Financing (Prevention and Prohibition) Act,
2022; and (3) The Proceeds of Crime (Recovery
and Management) Act, 2022; and
• domestication of the national AML/FT laws and
the gazette of the latest CBN AML/CFT/CPF
Regulations.
In line with these milestones, the AML/CFT
supervisory procedures for conducting risk-based
off-site and on-site examinations of financial
institutions in Nigeria were reviewed. Supervisory
cycles were being reviewed to accommodate riskbased targeted examination on the effectiveness
of risk management practices in mitigating money
laundering, terrorist financing and proliferation
financing risks within the banking sector.
Also, the Bank collaborated with domestic and
international
stakeholders,
namely;
the
Community of African Banking Supervisors (CABS),
the College of Supervisors of the West African
Monetary Zone (CSWAMZ), the Financial Stability

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Board (FSB), Regional Consultative Group for subSaharan Africa (RCG SSA) and the Financial
Stability Institute (FSI). These engagements
reviewed developments in the banking system
focusing on cross-border supervision issues and
joint examination exercises.

Similarly, the Bank submitted the updated
Memorandum of Understanding (MoU) with
Banque de Etats de l’Afrique Centrale (BEAC) on
April 14, 2022, for execution. The MoU was
updated
to
further
enhance
supervisory
cooperation between the CBN and BEAC. The Bank
also forwarded the completed questionnaire on
the applicable laws and regulations guiding the
CBN on information secrecy and data protection
to the Bank of England (BoE).

Consumer Protection
The Bank sustained the implementation of
measures to ensure consumer protection through
effective customer complaints management. The
Consumer
Complaints
Management
System
(CCMS) was modified to enhance efficiency and
improve interface with the banking public,
through the public portal. The portal would
provide a platform for customers of financial
service providers to escalate complaints that were
neither resolved nor satisfactorily treated by the
banks to the CBN.

Improved
operational
procedures
and
management of customer complaints have
lowered the number of complaints. The Bank
received 2,432 complaints, indicating a 2.1 per
cent decrease, compared with the 2,483 in the
second half of 2021. However, it was 23.3 per cent
higher than the 1,973 complaints reviewed in the
first half of 2021. The complaints comprised:
fraud, 697 (28.7 per cent); electronic/cards, 845
(34.8 per cent); excess charges, 115 (4.7 per cent)
and “Others”, 775 (31.8 per cent).

Figure 3.4.23: Category of Consumer Complaints in the
First Half of 2022

Source: Central Bank of Nigeria

A total of 2,725 complaints were resolved,
indicating an increase of 18.1 per cent and 29.3
per cent, relative to the 2,307 and 2,108
complaints, resolved in the preceding and
corresponding periods of 2021, respectively.
Figure 3.4.24: Complaints Resolved in the First Half of

Source: Central Bank of Nigeria
Total claims in local and foreign currencies
amounted to N8.13 billion and US$11,283.93 in
the first half of 2022, compared with the N15.88
billion and US$50.89 million in the preceding
period
of 2021
and
N16.57 billion
and
US$96,140.41, respectively, in the corresponding
period of 2021.

Excess charges
Fraud
Electronics/Cards
Others
Number of Complaints

2021H1
202H2
2022H1
Number of Complaints

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Figure 3.4.25a: Total Consumer Claims in the First Half
of 2022 (N Billion)

Source: Central Bank of Nigeria

Figure 3.4.25b: Total Consumer Claims in 2022H1
(US$)
Source: Central Bank of Nigeria

The sums of N3.36 billion and US$31,580.41 were
refunded in the first half of 2022, compared with
N6.04 billion and US$938,767.72 in the second
half of 2021; and N8.43 billion and US$53,782.49
in the first half of 2021.


Figure 3.4.26a: Total Refunds to Consumer Complaints
in the First Half of 2022 (N Billion)

Source: Central Bank of Nigeria

Figure 3.4.26b: Total Refunds to Consumer Complaints
in 2022H1 (US$)
Source: Central Bank of Nigeria


Market Conduct Supervision
The
CBN
initiated
and
implemented
the
development
of
a
Risk-Based
Supervision
framework for Consumer Protection with the aim
of identifying and focusing on financial products,
services and practices, which posed significant risk
to consumers. Consequently, the Consumer
Protection Risk-Based Supervision Framework was
developed.

N16.57
Billion
N15.88
Billion
N8.13
Billion
2021H1
2021H2
2022H1
96.14
50.89
11.28

2021H1
2021H2
2022H1
US$
N8.43
Billion
N6.04
Billion
N3.36
Billion
2021H1
2021H2
2022H1
53,782.49
938,767.72
31,580.41


2021H1
2021H2
2022H1
US$

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Financial Literacy
The Bank, in collaboration with the Shared Agent
Network Expansion Facilities (SANEF), organised a
Financial Literacy Awareness Workshop, with 384
participants in attendance. The workshop was
aimed at raising awareness on the Consumer
Protection initiatives of the Bank and help
consumers
understand
their
rights
and
responsibilities.
The Bank, in collaboration with the Bankers’
Committee and the Junior Achievers of Nigeria
(JAN), conducted the 2022 Global Money Week
(GMW) with the theme “Build Your Future, Be
Smart About Money” between 21st and 25th March
2022. To commemorate the event, the Bank
mentored over 500 secondary school students in
rural areas on the importance of savings,
budgeting, and investment, among others.
The Bank conducted a 5-day Financial Literacy
programme for 132 participants titled “Training of
Trainers (ToT) Programme for Faith-based
Organisations” in April 2022.
Nigeria Sustainable Banking Principles
The CBN continued to monitor the implementation
of the Nigeria Sustainable Banking Principles
(NSBPs) at individual banks and industry levels.
Semi-annual reports received from 26 banks
revealed that significant progress was made in the
implementation of the NSBPs. Banks that were yet
to achieve the minimum prescribed requirements
were advised to address the gaps.
The Asset Management Corporation of Nigeria
The cumulative recovery by Asset Management
Corporation of Nigeria (AMCON) stood at N971.13
billion, comprising cash recoveries of N549.89
billion and asset & shares forfeiture of N421.24
billion. In the first half of 2022, the Corporation
achieved cash recoveries of N17.08 billion and
asset forfeiture valued at N633.22 million.
The net carrying value of AMCON’s liabilities
increased by 3.2 per cent to N5.72 trillion in the
first half of 2022, from N5.54 trillion in the second
half of 2021. However, the liabilities declined by
1.6 per cent, compared with N5.81 trillion in the
corresponding half of 2021. Out of the N5.72
trillion, the combined value of the AMCON Note of
N3.86 trillion and Loan of N500.00 billion,
represented 76.3 per cent of the total liabilities.
The Note was due to mature on 27 December
2023, while the N500.00 billion loan would be due
for redemption on 30 December 2022. The CBN
had commenced engagements with AMCON on
the maturing obligation. The Corporation’s total
assets net of impairment stood at N896.49 billion
at end-June 2022, representing 15.6 per cent of
the liabilities.
Contributions to the Banking Sector Resolution
Cost Fund (BSRCF) by the CBN and participating
banks for the year 2022 was N354.06 billion. The
CBN makes an annual contribution of N50.00
billion to the BSRCF, while the contribution of the
participating banks is determined based on 50
basis points of their on-balance sheet assets and
contingents.
All funds collected in the BSRCF were invested in
Government Securities prior to utilisation of the
funds in December of every year by AMCON to
make scheduled repayments to the CBN. The
BSRCF is governed by a Board of Trustees,
constituted in line with the AMCON Amendment
Act 2019, and audited annually by External
Auditors appointed by the Board of Trustees in line

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with Section 60(T) of the AMCON Amendment Act
2015.
3.5 PAYMENTS SYSTEM MANAGEMENT
The Bank sustained implementation of its policies
to enhance efficiency of the payments system and
consolidate on the gains presented to the
payments system by the COVID-19 pandemic,
while contributing to the achievement of a digital
financial inclusion system during the review
period. Despite the downturn in global economic
activities, the Nigerian payments system remained
resilient at ensuring payments and settlement
effectiveness during the review period. The Bank
also embarked on the implementation of new
initiatives to further deepen and widen the
payments system landscape.
Payments System Policies
The Bank issued new regulations to promote
healthy
competition
through
increased
capabilities of the payment infrastructure and
interoperability. These include revised guidelines
on Quick Response Code Payment and exposure
draft on Operational Guidelines for Open Banking
in Nigeria

Payments System Infrastructure
The implementation of the Bank Verification
Number (BVN) and other innovative infrastructural
initiatives progressed in the first half of 2022 with
significant positive outcomes. The number of
customers enrolled on the BVN platform at 54.1
million, represented an increase of 5.2 per cent
and 11.5 per cent over 51.4 million and 48.5
million
recorded
in
the
preceding
and
corresponding periods, respectively. A total of
130.6 million bank accounts were linked with BVN,
compared with 117.6 million and 109.6 million at
end-December

and
end-June
2021,
respectively. There were 212.2 million bank
accounts in the banking industry at end-June
2022.
Payments System Strategy
Consistent with the PSV2025 Strategy Plan, the
Bank continued the implementation of the
Regulatory Sandbox, Open Banking Operations
and QR Code Payment initiatives. Hence, the Bank
issued a circular on the review of the Industry
Quick Response (QR) Code presentment options
for both merchant-presented and customerpresented modes. This was an improvement on
the initial guidelines that allowed only merchantpresented option.

The Bank issued the exposure draft on Operational
Guidelines for Open Banking in Nigeria aimed at
promoting permissioned data sharing for delivery
of innovative financial products and services to
bank customers. The operational guidelines
provide clear responsibilities and expectations for
the various participants, ensure safeguards for
financial system stability, promote competition
and enhance access to banking and other financial
services as well as stipulate that the Bank
maintains an Open Banking Registry (OBR) for
regulatory oversight.

Payments System Supervision and Regulation
The Bank continued to enhance its supervisory and
regulatory oversight over the payments system
during the review period. The number of licensed
Payments Service Providers (PSPs) rose to 116
from 100 and 99 at end-December 2021 and endJune 2021, respectively. Further analysis showed
that 4 licences were issued for Switching and
Processing, 9 for Payments Solution Service

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Providers (PSSPs), 4 for Payments Terminal Service
Providers (PTSPs), 4 for Super Agents and 2
Cheque Printers were accredited in the first half of


2022. However, the number of Mobile Money
Operators (MMOs) remained the same, while the
number of card schemes declined to 7 from 8
during the preceding period. Also, the Bank issued
licences to new Payments Service Banks (PSBs),
namely: MoMo PSB and SmartCash PSB.

Implementation of Nigeria Cheque Standard and
Nigeria Cheque Printers Accreditation Scheme
Version 2.0
In compliance with the stipulations of the Nigeria
Cheque Standard (NCS) and Nigeria Cheque
Printers Accreditation Scheme (NICPAS) Version
2.0, accreditation exercises were conducted and
licences for 2 Cheque Printers and 6 Cheque
Personalisers were renewed in the review period.
The automation of the accreditation process for
Cheque Printers and Personalisers in line with the
NCS/NICPAS version 2.0, was in progress.
Automation would: permit greater operational
productivity and effectiveness; reduce turnaround
time for processing request/application; and
realign the steps to optimize flow of information
between processing officers and applicants.


Table 3.5.1: Licensed Payments System Participants

The increase in consumer appetite for payment
solutions and the emergence of disruptive
technology in the financial services space resulted
in the Bank’s development of new and more
flexible ways of engaging with the industry. The
Bank set up the Regulatory Sandbox Steering and
Technical
committees to provide effective
governance for the initiative.
The objectives of the Regulatory Sandbox are to:
i. increase the potential for innovative business
models that advance financial inclusion;
ii. reduce time-to-market for innovative products,
services, and business models;
iii. increase competition, widen consumers’
choices and lower costs;
iv. ensure appropriate consumer protection
safeguards in innovative products;
v. ensure adequate provisions in regulations to
create an enabling environment for innovation
without compromising on safety for consumers
and the overall payment system; and
vi. provide an avenue for regulatory engagement
with FinTech firms in the payment space, while
contributing to economic growth.
License -Type
Number
June

Dec.

June

Card Schemes

Switching and Processing

Mobile Money Operators*

Payment Solution Service
Providers

Payment Terminal Service
Providers

Super Agents

Third Party Processors**

n.a
n.a
Non-Bank Acquirers**

n.a
n.a
Accredited Cheque Printers

Total

Source: Central Bank of Nigeria
*The data shown is for Non-Bank Licensed Mobile Money Operators.
** n.a – Not applicable with new licence categorisation

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Trends in the Payments System
Total electronic payment (e-payment) grew in
volume and value, indicating increased adoption
and usage during the first half of 2022. By
segment, both the retail and wholesale epayments recorded increases in volume and value.
Further analysis showed that volume of total epayments9 increased by 11.2 per cent and 155.8
per cent to 10,053.5 million, from 9,037.8 million
and 3,931.0 million in the second and first halves
of 2021, respectively. Total e-payments rose by
20.3 per cent and 237.8 per cent to ₦738.06
trillion, from ₦613.41 trillion and ₦218.49 trillion
in the second and first halves of 2021. The
significant rise in the usage of electronic payment
channels relative to the levels in the first and
second halves of 2021, reflected greater digital
financial inclusion.

Retail Payments System
The volume and value of retail e-payments
transactions increased in the first half of 2022. The
number of transactions across retail e-payment
channels increased to 10,053.3 million during the
review period by 11.2 per cent and 155.8 per cent
from 9,037.8 million and 3,930.8 million in the
preceding and corresponding halves of 2021,
respectively.
The
corresponding
value
of
transactions also rose to ₦701.15 trillion in first
half of 2022, representing 20.7 per cent and 283.6
per cent increases over its levels in the preceding
and corresponding periods of 2021.

A breakdown of the volume of transactions by epayment channels showed that internet/web,
PoS, mobile app, ATM, USSD and NEFT recorded

9 E-payments transactions includes all electronic platforms used to
settle financial transactions for households and businesses, such as
increases of 298.3 per cent, 60.0 per cent, 147.1
per cent, 89.6 per cent, 11.1 per cent and 7.7 per
cent to 6,487.2 million, 1,710.3 million, 803.2
million, 711.7 million, 267.7 million and 39.5
million in the first half of 2022 from their
respective levels in the first half of 2021. In
comparison with the preceding half year,
transactions on mobile app, internet/web and PoS
increased by 76.1 per cent, 14.1 per cent and 6.5
per cent, respectively, while transactions on NEFT,
ATM and USSD declined by 69.1 per cent, 14.8 per
cent and 2.5 per cent, respectively.

In value terms, transactions on ATM, PoS,
internet/web, and mobile app channels grew by
60.0 per cent, 66.8 per cent, 163.5 per cent and
153.8 per cent, compared with their respective
levels in the first half of 2021. Transactions on
NEFT and direct debit channels grew in thousand
folds, compared with their levels in the first half of
2021. In comparison with the preceding half of
2021, ATM, internet/web, PoS, NEFT and mobile
app channels grew by 5.5 per cent, 16.3 per cent,
8.7 per cent, 23.7 per cent and 78.0 per cent,
respectively. Direct debits fell by 22.8 per cent,
relative to its level in the preceding period of 2021,
while USSD channel recorded decline of 7.6 per
cent and 8.8 per cent, compared with its level in
the corresponding and preceding periods of 2021,
respectively.

Analysis of the components of retail e-payments
segment showed dominance of internet/web
ATMs, PoS, MMOs, internet (web), USSD, Mobile Apps and Direct
Debits.

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channel10, which accounted for 64.5 per cent of
total volume and 49.7 per cent of total value
during the review period. The volume of
transactions on PoS, mobile app and ATM
channels, accounted for 17.0 per cent, 8.0 per
cent, and 7.1 per cent, respectively in the first half
of 2022. In value terms, NEFT transfers accounted
for 37.2 per cent of the total value of e-payment
transactions in the first half of 2022.


Figure 3.5.1: Composition of e-Payments Transactions
by Volume, First Half 2022 (per cent)

Source: Central Bank of Nigeria

Figure 3.5.2: Share of e-Payments Transaction by
Value First Half 2022 (per cent)


10 Internet/web also include NIP, e-Bills Pay and Central Pay
transactions.
Source: Central Bank of Nigeria

Transactions by cheques in the review period
increased both in volume and value. The volume
of cheque transactions increased by 33.1 per cent
to 8.4 million in the first half of 2022 from 6.3
million in the corresponding period of 2021, while
it declined by 8.2 per cent from 9.2 million in the
preceding half of 2021. The value of cheque
transactions increased by 55.4 per cent to N7.49
trillion in the first half of 2022, from N4.82 trillion
in the first half of 2021, but fell by 4.9 per cent,
compared with the level in the preceding half of
2021.
Mobile Money Operators (MMOs) recorded a
boost in their activities, which include cash-in,
cash-out, fund transfer and bill payments. The
volume and value of payments services provided
by the MMOs via their agents touch points
increased by 2.8 per cent and 83.3 per cent,
respectively in the first half of 2022. The volume of
transactions rose to 445.3 million during the
review period from 433.0 million in the
corresponding half of 2021. The value also
increased to N9.58 trillion in the first half of 2022,
from N5.23 trillion in the first half of 2021. The
development was attributed to the increased
onboarding of agents in the drive for improved
financial inclusion.
At end-June 2022, the number of ATMs terminals
stood at 19,392, compared with 19,355 at endDecember 2021 and 19,156 terminals at end-June
2021. The number of connected Point-of-Sale
(PoS) terminals increased to 1,299,738 at endJune 2022, from 915,519 and 638,983 at endDecember 2021 and end-June 2021, respectively.

CENTRAL BANK OF NIGERIA
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Similarly, the number of agents at end-June 2022
stood at 1,249,845, compared with 1,002,514 at
end-December 2021 and 776,661 at end-June
2021.


Wholesale Payments System
Transactions in the wholesale payments (Real
Time Gross Settlement (RTGS)) system witnessed
an increase in volume and value. The volume of
inter-bank fund transfers through the CBN RTGS
System increased by 5.7 per cent and 2.8 per cent
to 149,035, compared with 141,592 and 145,914
in the first and second halves of 2021,
respectively. Similarly, the value of transactions
increased by 3.4 per cent and 14.2 per cent to
N36.91 trillion, compared with N35.70 trillion and
N32.33 trillion in the corresponding and preceding
periods of 2021, respectively. The marginal
increase in volume and value of transactions was
attributed to the uptick in economic activities.

Figure 3.5.3. Volume of Inter-bank RTGS Transactions

Source: Central Bank of Nigeria


Figure 3.5.4. Value of Inter-bank RTGS Transactions

Source: Central Bank of Nigeria


First Half 2021 Second Half 2021 First Half 2022

First Half 2021
Second Half 2021
First Half 2022
N'billion

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Table 3.5.2: Volume and Value of Electronic Payments and Other Channels
Payment
Channels
Number of Terminals
Volume of Transactions (Million)
Value of Transaction N' Trillion
Jun-21
Dec-21
Jun-22
Jun-21
Dec-21
Jun-22
Jun-21
Dec-21
Jun-22
ATM

POS

Internet (Web)
-
-


NEFT
-
-


RTGS
-
-


USSD
-
-


Mobile App
-
-


Direct Debits
-
-


Total e-Payment


Cheques
-
-


MMOs
-
-


Sources: Central Bank of Nigeria


NOTE: Total e-payment transactions includes ATM, online transfers, NEFT, RTGS, USSD, mobile app, and direct debit transactions
1/ Figures were revised

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3.6 EXTERNAL SECTOR DEVELOPMENTS
The external sector experienced an unprecedented
shock, following the outbreak of war between
Russia and Ukraine. In addition to the lingering
effect of COVID-19 containment measures, the
development resulted in further accumulation of
external debt, which undermined the viability of
the external sector. Consequently, the external
account weakened to a deficit of 0.3 per cent of
GDP, from an overall balance of payments surplus
of 1.7 per cent of GDP in the second half of 2021.
The deficit, however, was an improvement, relative
to the 1.7 per cent of GDP in the first half of 2021.

Rising international crude oil prices resulted in a
significant improvement in export earnings, which
culminated in a higher current account surplus of
3.5 per cent of GDP. The financial account
maintained a net borrowing position with a net
incurrence of financial liabilities of 1.0 per cent of
GDP, compared with 1.2 per cent in the preceding
period, while the international investment position
(IIP) posted a higher net liability of US$74.09 billion
in the review period.

The external reserves position at end-June 2022
was US$39.16 billion and could finance 8.9 months
of import (goods only) or 6.7 months of import
(goods and services), and above the international
benchmark of 3.0 months.

The stock of external debt increased to US$40.06
billion from US$38.39 billion at end-December
2021, following additional loan disbursements and
receipt of Eurobond proceeds. The demand
pressure in the foreign exchange market persisted,
owing largely to supply shortage, leading to the
depreciation of the naira in the review period.


Current and Capital Account Developments
Higher export earnings, and increased inflow of
remittances, contributed
to
the
significant
improvement in the current account, as a higher
surplus was recorded in the review period. Current
account surplus improved significantly to US$7.70
billion (3.5 per cent of GDP), compared with
US$1.13 billion in the second half of 2021. This
contrasted with the deficit of US$2.98 billion in the
first half of 2021. The improvement was mainly on
account of increased export earnings, reflecting
the gains of higher commodity prices at the
international market, particularly crude oil and
gas.
Figure 3.6.1: Current and Capital Account Balance
(US$ Billion)

Source: Central Bank of Nigeria

Trade
The trade surplus in the goods account increased
substantially to US$9.20 billion (4.6 per cent of
GDP), relative to US$0.34 billion in the second half
of 2021. This contrasted with a deficit of US$3.58
billion in the first half of 2021. The improvement
was majorly on account of higher export receipts,
following the sustained rise in commodity prices.


First Half

Second
Half 2020
First Half

Second
Half 2021
First Half


US$ Billion

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Export Performance
The COVID-19 induced supply chain disruptions,
worsened by the Russia-Ukraine crisis, pushed
crude oil and gas prices higher on the international
market,
thereby,
boosting
export
receipts.
Aggregate export earnings grew by 32.2 per cent
to US$35.50 billion (16.1 per cent of GDP),
compared with US$26.85 billion and US$20.01
billion in the second and first halves of 2021,
respectively. The improvement was due largely, to
the increase in the price of Nigeria’s reference
crude, the Bonny Light, to an average of
US$110.96 per barrel, from US$77.06 per barrel
and US$64.82 per barrel in the second and first
halves of 2021, respectively.
Crude oil and gas exports increased by 36.4 per
cent to US$31.57 billion (14.3 per cent of GDP) in
the first half of 2022, compared with US$23.14
billion and US$17.70 billion in the preceding and
corresponding halves of 2021, respectively. Crude
oil export receipts increased to US$27.76 billion,
relative to US$20.16 billion and US$14.99 billion in
the second and first half of 2021, reflecting
significant gains from rising crude oil prices. Gas
export receipts followed the same trend,
increasing to US$3.81 billion, compared with
US$2.98 billion and US$2.71 billion in the
preceding and corresponding halves of 2021,
respectively. In terms of share, crude oil and gas
component remained dominant, accounting for
89.0 per cent of total exports, with crude oil
constituting 78.3 per cent and gas accounting for
10.7 per cent. Non-oil exports accounted for the
balance.
Non-oil exports proceeds rose by 6.0 per cent to
US$3.93 billion (1.8 per cent of GDP), above
US$3.71 billion and US$2.31 billion in the second
and first halves of 2021, respectively. The increase
reflected the effect of soaring global commodity
prices. A breakdown of non-oil export by sector
revealed that “other” non-oil category (driven by
the export of urea) accounted for the largest share
of 38.6 per cent of total non-oil export receipts.
This was followed by agricultural sector exports,
which
constituted
34.8
per
cent.
Semimanufactured,
mineral
products
and
manufactured products accounted for 12.2 per
cent, 8.6 per cent and 5.9 per cent of total non-oil
export, respectively. The country’s major non-oil
export commodities were urea, cocoa beans,
sesame seeds, cashew nuts, and aluminium, while
the major export destinations included Brazil,
Vietnam, China, the Netherlands, Japan, Belgium,
and Malaysia
Export to the ECOWAS Sub-Region
Nigeria’s export to the ECOWAS sub-region
improved, reflecting the effect of the reopening of
the borders and return to normalcy from the
COVID-19 pandemic lockdown measures. Nigeria's
non-oil export to the ECOWAS sub-region
increased significantly to US$254.98 million in the
first half of 2022, from US$189.87 million and
US$104.61 million in the second and first halves of
2021. A breakdown showed that Nigeria’s export
to Republic of Benin, at US$70.03 million,
constituted 27.5 per cent of the total, followed by
Niger with US$58.23 million (22.8 per cent);
Ghana, US$43.01 million (16.9 per cent); and
Senegal, US$22.82 million (8.9 per cent). Export to
Togo was US$22.09 million (8.7 per cent); Côte
d'Ivoire, US$21.40 million (8.4 per cent); and
Guinea, US$6.19 million (2.4 per cent). Other
countries accounted for the balance of 4.4 per
cent. The major export commodities to the subregion were tobacco, instant noodles, detergents,

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plastics, dairy products, soyabean meal and
carbonated soft drinks.

Figure 3.6.2: Export to ECOWAS Sub-Regions (per cent)

Source: Central Bank of Nigeria

Foreign Exchange Earnings by Top the 100 Non-Oil
Exporters.
The Bank’s drive to boost non-oil exports and
soaring global commodity prices improved the
receipts of the top 100 exporters in the review
period. Receipts from the top 100 non-oil
exporters rose substantially by 70.9 per cent to
US$2.29 billion, from US$1.34 billion in the first
half of 2021. It was also higher than US$1.67
billion in the preceding half of 2021. The value of
the top 100 non-oil exports accounted for 58.3 per
cent of total non-oil export receipts. Analysis
shows that Indorama Eleme Fertilizer and
Chemical Limited topped the list with US$667.81
million or 29.2 per cent of the total, from the
export of urea, fertilizers, and agronomy services
to Turkey and China. Dangote Fertilizer Limited
followed with a value of US$206.14 million,
representing 9.0 per cent of the total, from the
export of fertilizer to the United States and Brazil.
In third place were Starlink Global and Ideal
Limited, with earnings of US$102.99 million (4.5
per cent) from the export of cocoa beans, cashew
nuts, and sesame seeds to Turkey and China.
Metal Recycling Industries Limited was placed
fourth with an export value of US$84.18 million
(3.7 per cent), from the export of aluminium alloy
ingots, copper billets and brass ingots to China.
This was followed by Segilola Resources Operating
Limited with a value of US$67.38 million (2.9 per
cent), from the export of gold to China.
Outspan Nigeria Limited and British American
Tobacco were sixth and seventh, with export of
US$62.00 million (2.7 per cent) and US$61.08
million (2.6 per cent), respectively. The former
exported cocoa beans and cashew nuts to
Malaysia, the US and Vietnam, while the latter
exported cigarettes to Ghana, Cameroon, and
Cote d'Ivoire. WACOT Limited, Olam Nigeria
Limited and ETC Agro Company Nigeria Limited
ranked eighth, ninth and tenth, with earnings of
US$56.01 million (2.5 per cent), US$44.02 million
(1.9 per cent), and US$43.60 million (1.8 per cent),
respectively. WACOT exported cotton products,
sesame seeds and ginger to The Netherlands and
the United States, Olam exported fermented
cocoa bean seeds to Australia, Greece and Turkey,
and ETC Agro exported sesame seeds to Japan.
Non-Oil Receipts through Banks
Non-oil export proceeds repatriated through the
banking system increased by 19.2 per cent to
US$2.28 billion, relative to the level in the
preceding period. This represented 58.0 per cent
of total non-oil export receipts in the review
period. A breakdown of the proceeds by sector
showed that receipts from the export of
agricultural products accounted for 42.5 per cent
of total receipts, followed by manufactured
Benin
27.5%
Niger
22.8%
Ghana
16.9%
Senegal
8.9%
Togo
8.7%
Côte d’Ivoire
8.4%
Guinea
2.4%
Others Ecowas
Countries
4.4%

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products with a share of 27.3 per cent of the total.
Proceeds from the sale of industrial products
constituted 26.4 per cent; mineral products, 2.6
per cent; food products, 1.0 per cent; and
transport, 0.2 per cent.


Figure 3.6.3: Non-Oil Export Receipts by Banks (per cent)

Source: Central Bank of Nigeria

Merchandise Import
Merchandise import bills declined, owing to
demand switch to locally produced goods, coupled
with the lingering effect of the supply chain
disruption. Aggregate merchandise import was
US$26.30 billion (12.0 per cent of GDP), compared
with US$26.51 billion and US$23.59 billion in the
second and first halves of 2021, indicating declines
of 0.4 per cent and 12.8 per cent, respectively.
Analysis shows that both the importation of nonoil products and petroleum products decreased to
US$18.84 billion (8.6 per cent of GDP), and
US$7.46 billion (3.4 per cent of GDP), relative to
US$18.94 billion and US$7.57 billion in the second
half of 2021, respectively. Despite the decline in
non-oil import, it accounted for the larger share of
71.6 per cent of total import, while oil accounted
for the balance of 28.4 per cent.
A breakdown of merchandise imports by broad
economic categories indicated that the industrial
sector accounted for 43.9 per cent, followed by
fuels and lubricants, which constituted 26.8 per
cent. Food and beverages was 13.4 per cent, while
transport equipment and parts accounted for 8.4
per cent. Consumer goods represented 7.0 per
cent, and others, 0.5 per cent.
Figure 3.6.4: Export, Import and Trade Balance (US$ Billion)

Source: Central Bank of Nigeria

Services
The deficit in the services account widened as the
demand for services increased, driven majorly by
higher cost of transportation and travel services.
The deficit in the services account widened by 7.0
per cent to US$6.42 billion (2.9 per cent of GDP),
compared with US$6.00 billion in both the second
and first halves of 2021, respectively.
An analysis of the services account shows that
payments for services import increased by 9.3 per
cent to US$8.62 billion in the review period,
relative to US$7.89 billion in the second half of
2021. A further breakdown reveals that payments
for transportation and travels rose by 21.1 per

F i r s t H a l f 2 0 2 1 S e c o n d H a l f 2 0 2 1 F i r s t H a l f 2 0 2 2
Industrial
Food
Manufactured
Transport
Agriculture
Minerals
-20
-10

First Half

Second Half

First Half

Second Half

First Half

Import
Export
Trade Balance

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cent and 30.2 per cent to US$3.89 billion and
US$1.80 billion in the first half of 2022,
respectively, from US$3.21 billion and US$1.38
billion in the second half of 2021. Payments for
transportation also indicated an increase above
US$2.18 billion in the corresponding period, but
that for travels was lower than US$3.05 billion in
the same period. The increase in payments for
transportation was attributed to higher spending
on personal transportation and freight charges,
while that of travels was due to increased payment
for health and education related travels, on
account of easing of COVID-19 travel restrictions
in some economies. Similarly, payments for
telecommunication and government services
increased by 3.8 per cent and 11.4 per cent to
US$0.30 billion and US$0.15 billion, respectively,
compared with the levels in the preceding period.
On the contrary, payment for other business
services declined by 10.8 per cent to US$1.87
billion in the first half of 2022, relative to US$2.10
billion in the second half of 2021. This was driven
by the heels of lower payments for professional
and management consulting, technical, traderelated, and other services. Payments for financial
services also declined significantly by 41.4 per cent
to US$0.15 billion, relative to the level in the
preceding period, as banks managed demand for
foreign exchange efficiently. Insurance services,
being a joint demand with merchandise import,
also declined by 18.2 per cent to US$0.32 billion,
compared with the level in the preceding period.
In terms of share in total services payments,
transportation services accounted for 45.1 per
cent, followed by other business services with 21.7
per cent. Travels was 20.9 per cent; insurance, 3.8
per cent; telecommunications and computer
services, 3.5 per cent; government services, 1.8
per cent; financial services, 1.7 per cent; and
charges on intellectual property, 1.5 per cent.
Figure 3.6.5: Share of Services Out-Payments (per cent)

Source: Central Bank of Nigeria
Aggregate earnings from services export increased
by 16.1 per cent and 4.4 per cent to US$2.20
billion, compared with US$1.89 billion and
US$2.10
billion
in
the
preceding
and
corresponding halves of 2021, respectively. The
increase was driven majorly by earnings from
travel services, indicating a gradual return of the
economy to pre-pandemic levels.
A breakdown shows that receipts from travels
increased significantly to US$0.50 billion, from
US$0.10 billion in the second half of 2021, due to
higher inflow from other personal travels. Receipts
from telecommunications services also increased
by 26.0 per cent to US$0.12 billion, relative to
US$0.10 billion in the second half of 2021.
Conversely, receipts in respect of transportation
declined by 5.1 per cent to US$0.95 billion, from
US$1.00 billion in the second half of 2021,
following the decline in receipts from freight
charges. Receipts from financial services also
declined by 16.7 per cent to US$0.35 billion,
relative to the US$0.41 billion in the preceding half
of 2021. Furthermore, government services
Transport
45.1%
Travel
20.9%
Insurance &
Pensions
3.8%
Financial
1.7%
Charges for the
use of intellectual
property
1.5%
Telecommunicatiions
3.5%
Other business
21.7%
Government
1.8%

CENTRAL BANK OF NIGERIA
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receipts decreased by 3.7 per cent to US$0.22
billion, from US$0.23 billion in the second half of
2021.
As a share of total services receipts, transport
accounted for 43.4 per cent, while travel services
constituted 22.8 per cent. This was followed by
financial services receipts, which accounted for
15.7 per cent; government services, 10.2 per cent;
and telecommunications services 5.6 per cent.
Other categories of services accounted for the
balance.

Figure 3.6.6: Share of Services Receipts (per cent)

Source: Central Bank of Nigeria

Primary Income
The deficit in the primary income account widened,
as repatriation of investment income by foreign
investors increased, reflecting uptick in business
activities following the removal of COVID-19
restrictions. The deficit in the primary income
account, at US$6.56 billion, widened by 43.3 per
cent and 64.9 per cent, relative to US$4.58 billion
in the preceding half of 2021 and US$3.98 billion
in the corresponding period of 2021.

Investment income, comprising payments of
dividends and profits, increased by 28.5 per cent
to US$7.40 billion, compared with US$5.76 billion
in the preceding half of 2021. A breakdown shows
that of dividends payments increased by 29.1 per
cent to US$6.37 billion, compared with US$4.94
billion in the second half of 2021. Similarly,
reinvested earnings increased significantly to
US$0.69 billion, from US$0.30 billion in the
preceding half year. The increase reflected
improvement in business environment, signaling
gradual return to pre-pandemic levels.

Interest payments on portfolio investment also
increased to US$0.13 billion in the review period,
relative to US$0.07 billion in the second half of
2021. Interest payment on loans increased by 23.2
per cent to US$0.87 billion, from US$0.71 billion in
the preceding period. Interest earnings on
external reserves investments decreased to
US$0.15 billion, from US$0.33 billion.

The compensation of employees sub-account
maintained a surplus position, though lower by 1.1
per cent, at US$0.11 billion, compared with the
level in the preceding half of 2021.

Secondary Income
Despite
the
challenging
global
economic
environment, inflow of remittances improved,
owing to the effective implementation of
remittances reform policies by the Bank. The
surplus in the secondary income account
increased to US$11.48 billion (5.3 per cent of GDP)
in the review period, compared with US$11.38
billion (4.9 per cent of GDP) in the preceding half
of 2021. The surplus was also higher by 8.5 per
cent,
relative
to
US$10.6
billion
in
the
corresponding period of 2021.
Remittances by Nigerian migrant workers, which
constituted 86.4 per cent of total inflow, rose to
US$10.11 billion, from US$10.02 billion and
Transport
43.4%
Travel
22.8%
Financial
15.7%
Telecommunic
atiions
5.6%
Government
10.2%
Others
2.3%

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US$9.22
billion
in
the
preceding
and
corresponding halves of 2021. This was on the
back of the continued adoption of official bank
channels as a result of the Bank’s policies on
enhancing remittances inflow, particularly the
“Naira-4-Dollar” Scheme. General government
transfers decreased marginally to US$1.55 billion
in the first half of 2022, compared with US$1.57
billion in the preceding half of 2021, reflecting
lower inflow of grants, on account of lingering
effect of COVID-19 in donor economies.
Figure 3.6.7: Workers’ Remittances (US$’ Billion)

Source: Central Bank of Nigeria
Financial Account Developments
A net borrowing position was recorded in the
review period, mainly on account of higher
incurrence of liabilities, driven majorly by swap
transactions. The financial account recorded a
lower net incurrence of liabilities of US$2.19
billion or 1.0 per cent of GDP, compared with
US$2.78 billion in the preceding half of 2021, and
US$4.23 billion in the corresponding period of
2021, respectively. This was due, largely, to swap
transactions in the review period.
Net Incurrence of Liabilities
Tighter global financial conditions, coupled with
uncertainties surrounding the Russia-Ukraine
conflict, dampened investors’ sentiments, and
resulted in a lower inflow of foreign capital in the
review
period. Aggregate
foreign financial
liabilities declined to US$6.83 billion, compared
with US$13.58 billion and US$7.72 billion in the
second and first halves of 2021, respectively.
A breakdown shows divestment in FDI amounting
to US$1.91 billion in the first half of 2022, against
an inflow of US$0.32 billion in the preceding half
of 2021. Portfolio investment inflow, comprising
equity and debt securities, reduced to US$3.22
billion, compared with US$4.45 billion in the
preceding half of 2021, reflecting tighter global
financial conditions and the effect of the rate hike
in most advanced economies. Similarly, ‘other’
investment decreased to US$4.52 billion, relative
to US$8.82 billion in the preceding half of 2021, as
a result of lower incurrence of loans and decline in
foreign currency placement in deposit taking
corporations. Financial derivatives recorded an
inflow of US$1.00 billion, following swap
transactions in the review period.
Figure 3.6.8: Foreign Capital Inflow (US$ Billion)

Source: Central Bank of Nigeria

Net Acquisition of Asset
Aggregate financial assets decreased by 57.0 per
cent to US$4.64 billion, compared with US$10.80
billion in the preceding half of 2021. The

First Half 2020 Second Half

First Half 2021 Second Half

First Half 2022
F i rs t
Ha l f
2 0 2 0
Sec on d
Ha l f

F i rst
Ha l f

Sec on d
Ha l f

F i rst
Ha l f

FDI
Portfolio Investment
Other Investment
Financial Derivatives

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development was due, largely, to significantly
lower foreign currency holdings of deposit-taking
corporations. It, however, increased compared
with US$3.49 billion in the corresponding half of
2021.
An analysis shows a divestment of direct
investment assets by resident investors in the
review period to the tune of US$0.25 billion,
against an acquisition of financial assets of
US$1.58 billion in the second half of 2021.
Portfolio investment assets increased to US$0.29
billion, compared with US$0.25 billion in the
preceding half of 2021. Acquisition of ‘other
investment’ asset decreased to US$4.39 billion,
compared with US$4.97 billion in the preceding
half of 2021, reflecting lower foreign currency
holdings of the deposit taking corporations.
Consequently,
reserve
assets
witnessed
a
depletion, amounting to US$0.79 billion in the
review period, against an accretion of US$4.01
billion in the preceding half of 2021.
External Debt
Nigeria's public external debt surged in the review
period, owing to new borrowings. Public external
debt increased to US$40.06 billion at end-June
2022, compared with US$38.39 billion at endDecember 2021, and US$33.47 billion at end-June
2021. A breakdown shows that loans from
multilateral sources increased to US$19.16 billion,
constituting 47.8 per cent of the total, from
US$18.66 billion at end-December 2021, owing to
additional loans from the World Bank and Africa
Development Bank groups. Debt from commercial
sources increased to US$15.62 billion (39.0 per
cent), compared with US$14.67 billion (38.2 per
cent), at end-December 2021, reflecting new
issuance of Eurobonds. Loans from bilateral
sources also increased to US$4.70 billion (11.7 per
cent), compared with US$4.47 billion (11.6 per
cent) at end-December 2021, due to new
disbursements by China Exim Bank. Promissory
notes declined by 2.1 per cent to US$0.59 billion
and accounted for the balance.

International Investment Position
Increased inflow of other investment liabilities
resulted to a higher net liability position in
Nigeria's International Investment Position. A
higher net financial liability of US$74.09 billion was
recorded at end-June 2022, compared with
US$70.30 billion at end-December 2021 and
US$77.54 billion at end-June 2021.
The stock of financial liabilities, representing
foreign investors' claims on the economy, grew to
US$182.74 billion at end-June 2022, relative to
US$174.55 billion at end-December 2021 and
US$168.14 billion at end-June 2021, indicating an
increase of 4.7 per cent and 8.5 per cent,
respectively. The development reflected an
increase in the stock of money market instruments
held by foreign investors, bilateral currency swaps,
and higher loan liabilities of banks and the general
government. The stock of portfolio investment
increased by 12.6 per cent to US$37.02 billion at
end-June 2022, relative to US$32.87 billion at endDecember 2021.
FDI liabilities fell by 0.3 per cent to US$87.28
billion at end-June 2022, relative to US$87.53
billion at end-December 2021. The stock of
financial derivatives increased by 60.1 per cent to
US$3.21 billion at end-June 2022, from US$2.00
billion at end-December 2021.
The stock of financial assets grew by 3.9 per cent
to US$108.34 billion at end-June 2022, compared
with US$104.25 billion at end-December 2021.

CENTRAL BANK OF NIGERIA
Half Year Economic Report, 2022
This document is for CBN internal consumption
This document is for CBN internal consumption
This was due to an increase in the stock of direct
and portfolio investments abroad and other
investment assets, indicating higher claims by
Nigerian investors on the rest of the world.
Further analysis reveals that the stock of FDI assets
declined by 2.1 per cent to US$13.30 billion at
end-June 2022, relative to US$13.58 billion at endDecember 2021. Other investment assets rose by
8.6 per cent to US$49.35 billion, compared with
US$45.45 billion at end-December 2021.
The stock of reserve assets fell by 2.7 per cent to
US$39.16 billion at end-June 2022, relative to
US$40.23 billion at end-December 2021. Portfolio
investment increased by 11.4 per cent to US$3.32
billion at end-June 2022, relative to its level at endDecember 2021.
International Reserves
The external reserves remained above the
international benchmark of three months of
import cover. Gross external reserves at end-June
2022 stood at US$39.16 billion, compared with
US$40.23 billion and US$32.99 billion at endDecember 2021 and end-June 2021, respectively.
The 2.7 per cent decline, when compared with the
level at end- December 2021, was mainly, due to
the Bank’s intervention at the foreign exchange
market and settlement of other obligations
including public sector and external debt service
payments.
A breakdown of external reserves by ownership
shows that, the CBN maintained its dominance,
with a share of 96.8 per cent, followed by the
Federal Government with 3.1 per cent. The
Federation accounted for the remaining 0.1 per
cent. In terms of currency composition, the US
dollar, at US$29.99 billion, constituted 76.6 per
cent of the total; Special drawing rights, US$5.05
billion (12.9 per cent); Chinese yuan, US$3.65
billion (9.3 per cent); while other currencies
accounted for the balance of 1.2 per cent.
An assessment of external reserves adequacy
based on the traditional benchmark showed that,
the end-June 2022 level of reserves could finance
6.7 months of import of goods and services or 8.9
months of goods only, higher than the 3.0 months
international benchmark. The ratio of external
reserves to short-term liabilities was 5.8
percentage points above the benchmark of 100.0
per cent short-term debt cover, based on the
Greenspan-Guidotti measure of external reserves
adequacy. In terms of external reserves to money
supply (M3), the ratio, at 31.4 per cent, indicated
that the level of reserves was inadequate, as it was
above the international benchmark of 20.0 per
cent.
Figure 3.6.9: External Reserves Stock and Reserve Adequacy
Measures

Source: Central Bank of Nigeria

External Asset Management Programme and
Income from Reserves Management
The performance of the external reserves
portfolio was mixed. On the one hand, the
persistent rise in inflation and subsequent
increase in interest rates by the Federal
Reserve Bank and other major central banks

First Half 2021
Second Half 2021
First Half 2022
Reserves
Import Cover (Goods)
Import Cover (G&S)
Reserve/M3
Short-Term Debt Cover

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affected the performance of global financial
assets, leading to decline in prices of fixed
income securities, while income received
from fixed term deposits and coupon
payments increased. Consequently, the
return on the money market and fixed
income held-to-maturity portfolios were
positive. On the other hand, gold and fixed
income
marked-to-market
portfolios
declined, recording unrealised losses.
The net asset value of the fixed income
portfolio managed by the external asset
managers decreased to US$7.26 billion at
end-June 2022, from US$7.45 billion and
US$7.46 billion at end-December 2021 and
end-June 2021, respectively. This was due to
decline in prices of bonds (fixed income
securities) as yields increased. Cumulatively,
the portfolio recorded an absolute return of
US$853 million from inception to end-June
2022.
Foreign Exchange Flows
The economy recorded a lower net foreign
exchange inflow on account of declining receipts
from the Bank and autonomous sources. Foreign
exchange flow through the economy recorded net
inflow of US$16.84 billion in the first half of 2022,
compared with US$28.15 billion in the second half
of 2021.
Aggregate inflow into the economy fell by 23.7 per
cent and 12.6 per cent to US$38.70 billion in the
first half of 2022, compared with US$50.73 billion
and US$44.27 billion, in the second and first halves
of 2021, respectively. The development was
driven, largely, by 36.9 per cent and 9.8 per cent
decrease in inflow through the CBN and
autonomous sources. A breakdown shows that
inflow through the CBN and autonomous sources
accounted for 42.4 per cent and 57.7 per cent,
respectively.
Inflow through autonomous sources decreased by
9.8 per cent to US$22.30 billion, from US$24.72
billion in the second half of 2021. A disaggregation
shows that invisible purchases declined by 11.7
per cent to US$19.99 billion, from US$22.64 billion
in the second half of 2021. Of the total invisible
purchases,
ordinary
domiciliary
account
decreased to US$9.00 billion, from US$10.26
billion in the second half of 2021. Similarly, total
Over-the-Counter (OTC) purchases, at US$10.86
billion, indicated a 12.3 per cent decline, relative
to US$12.38 billion in the second half of 2021.
However, non-oil export receipts by banks
increased by 12.0 per cent to US$2.28 billion,
compared with US$2.03 billion in the second half
of 2021.
Foreign exchange inflow through the CBN fell by
36.9 per cent to US$16.40 billion, from US$26.01
billion in the second half of 2021. The
development was attributed to 44.8 per cent
decline in non-oil receipts to US$12.43 billion,
from US$22.52 billion in the second half of 2021.
This was driven, mainly, by the 68.8 per cent, 33.0
per cent and 63.3 per cent decreases in proceeds
from Revalued Gold Holding, Treasury Single
Account (TSA) & Third-Party receipts, and other
official receipts to US$1.25 billion, US$4.81 billion
and US$1.29 billion, respectively. Further analysis
reveals that interbank swaps and foreign exchange
purchases increased by 32.4 per cent and 33.7 per
cent to US$3.33 billion and US$1.18 billion,
respectively, against the receipts in the preceding
period.
Conversely, crude oil-related receipts rose by 13.8
per cent to US$3.97 billion, above the US$3.49

CENTRAL BANK OF NIGERIA
Half Year Economic Report, 2022
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billion in the second half of 2021, as a result of
increased global crude oil prices during the first
half of 2022.
Aggregate foreign exchange outflow from the
economy, at US$21.81 billion, declined by 3.2 per
cent, relative to the level in the second half of
2021. A breakdown shows that outflow through
the autonomous sources rose by 23.6 per cent to
US$4.97 billion, compared with the level in the
second half of 2021.
Aggregate foreign exchange outflow from the
economy, at US$19.05 billion, declined by 34.6 per
cent, relative to the level in the first half of 2020.
A breakdown showed that outflow through
autonomous sources fell by 21.1 per cent to
US$1.41 billion, compared with the level in the
first half of 2020, as a result of higher payment for
invisible services.
Outflow through the CBN decreased by 9.0 per
cent to US$16.89 billion, owing, largely, to decline
in interbank utilisation, third-party MDA transfers,
and public sector/direct payments. Further
disaggregation shows that interbank utilisation,
decreased by 7.9 per cent to US$9.67 billion or
57.3 per cent of the Bank’s outflow, compared
with the level in the second half of 2021, on
account of lower foreign exchange sales at the
Investors’ and Exporters’ (I&E), invisible/interbank
and Secondary Market Intervention Scheme
(SMIS) windows. Similarly, third-party MDA
transfers and public sector/direct payments
declined by 40.1 per cent and 26.2 per cent to
US$2.78 billion and US$1.24 billion, respectively.


Figure 3.6.10: Foreign Exchange Disbursements through the
CBN (per cent)

Source: Central Bank of Nigeria

A net inflow of US$17.33 billion was recorded
through autonomous sources, compared with
US$20.70 billion in the second half of 2021. The
CBN recorded a net outflow of US$0.49 billion, in
contrast to a net inflow of US$7.45 billion in the
second half of 2021.
Figure 3.6.11: Foreign Exchange Flows through the CBN
(US$ Billion)

Source: Central Bank of Nigeria


Funds returned to
remitter
0.0%
Interbank
utilisation
57.3%
Drawings on L/Cs
4.4%
External Debt
Service
8.1%
Forex Special
Payments
0.8%
Public
Sector/Direct
Payments
7.3%
Bank and SDR
Charges
0.2%
3rd Party MDA
Transfers
16.5%
National Priority
Projects
0.0%
Others

1st Half 2021
2nd Half 2021
1st Half 2022
Inflow
Outflow
Netflow

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Half Year Economic Report, 2022
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Foreign Exchange Management
Pressure in the foreign exchange market
continued, amid persisting supply shortages.
Consequently, the Bank implemented some
policies and programmes to enhance foreign
exchange inflow and ensure efficient utilisation of
foreign exchange.
The Bank introduced the Race to $200.00 million
(RT200) programme on 25 February 2022, to raise
US$200.00 billion in foreign exchange earnings
from non-oil export over the period of three to five
years. The Scheme aims to enhance and diversify
the sources of foreign exchange inflow, increase
the level of contribution of non-oil exports, ensure
the stability and sustainability of foreign exchange
inflow, and support export-oriented companies to
expand export operations and capabilities. The
categories include Value-Adding Exports Facility,
Non-Oil Commodities Expansion Facility, Non-Oil
FX Rebate Scheme, Dedicated Non-Oil Export
Terminal, and Bi-annual Non-Oil Export Summit.
The Rebate scheme was designed to incentivise
non-oil export and encourage repatriation of
export proceeds. The Scheme pays N65.00 for
every US$1.00 repatriated and sold at the I&E
window to Authorised Dealer Banks (ADBs) for
other third-party use, and N35.00 for every
US$1.00 repatriated and sold in the I&E window
for own use on eligible transactions. In addition,
the Bank commenced the Bi-annual Non-Oil
Export Summit in June 2022.
In line with efforts to ensure efficient utilization
and management of foreign exchange, the Bank
deployed the Price Verification System (PVS). The
system is designed to operate on a global price
verification mechanism guided by a benchmark
price. The benchmark price is the actual spot
market price obtainable at the time of
consummation of invoicing in the markets, where
the goods are traded.
Foreign Exchange Sales
The Bank sustained its interventions in the foreign
exchange market to enhance liquidity and ensure
stability. Total foreign exchange supplied to
authorised dealers by the Bank was US$9.67
billion, a decrease of 7.9 per cent, below the level
in the second half of 2021.
A breakdown reveals that foreign exchange sales
at the inter-bank/invisible and Small and Medium
Enterprises
(SMEs)
windows
decreased
to
US$0.94 billion and US$0.72 billion, from US$1.28
billion and US$0.79 billion in the second half of
2021. Similarly, sales under the SMIS and to the
I&E window declined by 6.4 per cent and 17.7 per
cent to US$3.84 billion and US$2.24 billion,
respectively, compared with the levels in the
second half of 2021.
Figure 3.6.12: Supply of Foreign Exchange (US$ Billion)

Source: Central Bank of Nigeria

Forward and Swap Transactions
In the first half of 2022, wholesale forward sales
declined by 1.3 per cent to US$4.84 billion, from
US$4.78 billion in the corresponding half of 2021.
Matured swap transactions increased by 65.8 per

H1 2020
H2 2020
H1 2021
H2 2021
H1 2022

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cent to US$1.93 billion, from US$1.16 billion in the
second half of 2021.

Exchange Rate Movements
The exchange rate of the naira to the US dollar
remained relatively stable at the Investors’ and
Exporters’ (I&E) window.
Spot Exchange Rate
The average exchange rate of the naira to the US
dollar at the I&E window depreciated by 1.0 per
cent and 2.2 per cent to ₦416.02/US$, relative to
the ₦411.85/US$ and ₦406.77/US$ in the second
and first halves of 2021, respectively.
Figure 3.6.13: Average Exchange Rate Movements (N /US$)

Source: Central Bank of Nigeria

The exchange rate of the naira to the US dollar at
the I&E window, closed at N414.00/US$, at endJune 2022, relative to N413.00/US$ at the endDecember 2021 and N411.50/US$ at end-June
2021.
Cross Rates
The average exchange rate of the naira
appreciated by 3.5 per cent, 5.1 per cent and 8.5
per cent against the British pound, euro and
Japanese yen, respectively, compared with their
levels in the second half of 2021. Relative to peer
countries, the naira appreciated by 6.4 per cent
and 2.4 per cent, against the CFA francs and
WAUA, relative to their respective values in the
second half of 2021.

Sectoral Utilisation of Foreign Exchange
Aggregate utilisation of foreign exchange by
sectors decreased, driven, mainly by contraction in
invisibles import. Aggregate sectoral utilisation of
foreign exchange was US$14.65 billion, indicating
a decrease of 4.6 per cent, compared with the
level in the preceding period of 2021. However, it
rose by 43.1 per cent relative to the level in the
corresponding period of 2021. A disaggregation
reveals that US$9.04 billion or 61.7per cent of the
foreign exchange was utilised for visible import,
indicating an increase of 7.2 per cent and 53.6 per
cent, compared with the levels in the second half
and first half of 2021, respectively.
Further analysis shows that the amount utilised by
the industrial sector, at US$4.41 billion, rose by
21.4 per cent, over the level in the second half of
2021. Similarly, utilisation by oil, mineral and
transport sectors rose by 30.2 per cent, 237.1 per
cent, and 31.0 per cent, to US$0.70 billion,
US$0.32 billion and US$0.31 billion, respectively,
compared with their respective levels in the
preceding period.
The amount utilised for manufactured, food
products and agricultural sectors declined by 8.0
per cent, 25.5 per cent and 26.2 per cent, to
US$1.92 billion, US$1.25 billion and US$0.12
billion in the first half of 2022, respectively,
relative to the levels in the preceding half of 2021.

H1 2020
H2 2020
H1 2021
H2 2021
H1 2022
I&E

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Figure 3.6.14: Share of Sectoral Utilisation of Foreign
Exchange (Visible)

Source: Central Bank of Nigeria
Invisible transactions at US$5.62 billion or 38.3 per
cent of the total, declined by 18.9 per cent, below
the level of US$6.92 billion, in the second half of
2021, but increased by 28.9 per cent, above
US$4.36 billion recorded in the first half of 2021. A
breakdown shows that the amount utilised for
financial services and other services declined by
27.7 per cent and 7.8 per cent, to US$3.96 billion
and US$0.41 billion, respectively, below the levels
in the second half of 2021. The amount utilised for
educational, business and transport services,
increased by 15.5 per cent, 31.5 per cent and 15.1
per cent, to US$0.49 billion, US$0.46 billion and
US$0.22 billion, respectively, compared with the
levels in the second half of 2022.
Figure 3.6.15: Share of Sectoral Utilisation of Foreign
Exchange (Invisibles) (Per cent)

Source: Central Bank of Nigeria

Nominal Effective Exchange Rate (NEER) and Real
Effective Exchange Rate (REER) Indices
The average 13-currency NEER index (November
2009=100) in the review period was 194.78 index
points, indicating a decline of 2.3 per cent and 3.1
per cent, relative to the levels in the second and
first half of 2021, respectively. The average REER
index (November 2009=100), which measures
external competitiveness, was 65.83 points,
representing a decline of 7.2 per cent and 11.6 per
cent, compared with the levels in the second and
first half of 2021, respectively. The indices indicate
depreciation against the major trading partners,
which denote increased export competitiveness.
Figure 3.6.16: Nominal Effective Exchange Rate (NEER) and
Real Effective Exchange Rate (REER).

Source: Central Bank of Nigeria


Industrial,
48.83
Food Products,
13.82
Manufactured
Products,
21.21
Transport,
3.44
Agriculture,
1.35
Minerals, 3.58
Oil, 7.76
Business
Services, 8.2
Education
Services, 8.7
Financial
Services, 70.5
Other'
Services , 8.7
Transport
Services, 4.0

2020H1
2020H2
2021H1
2021H2
2022H1
NEER
REER

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Section Four


The short-to medium-term outlook of the Nigerian economy is
fragile but improving, drawing on dynamics in the global and
domestic economies, market sentiments and forecasts.
❖ Outlook
• Global Economy
• Real Domestic Economy
• Fiscal Policy
• Financial Sector, and
• External Economy

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4.1 GLOBAL ECONOMIC OUTLOOK
Output: According to the IMF World Economic
Outlook (July 2022), global output growth is
expected to slow in the second half of 2022, as
most economies seek to rein in the rising
inflationary pressure. Global output, is therefore,
projected to grow by 3.2 per cent in 2022, and 2.9
per cent in 2023, a moderation from the 6.1 per
cent growth in 2021.
In the advanced economies (AEs), output growth
is projected to slow to 2.5 per cent in 2022, and
1.4 per cent in 2023 from 5.2 per cent in 2021. In
the United States, output is expected to
moderate to 2.3 per cent in 2022 from 5.7 per
cent in 2021, attributed to the anticipated impact
of tighter monetary policy. Growth in the euro
area is projected to slow to 2.6 per cent in 2022
from 5.4 per cent in 2021 but remain unchanged
at 1.7 per cent in the UK.
In emerging markets and developing economies
(EMDEs), growth is projected at 3.6 per cent in
2022, and 3.9 per cent in 2023, a deceleration
from the 6.8 per cent growth recorded in 2021.
The expected slowdown is driven by growth
moderation in China and India. Specifically, China
and India are projected to grow by 4.6 per cent
and 3.3 per cent in 2022, from 7.3 per cent and
8.1 per cent, respectively, in 2021. In the Middle
East and Central Asia, growth in 2022 is projected
at 4.8 per cent from 5.8 per cent in 2021.
The outlook for sub-Saharan Africa is positive,
with growth projected at 3.8 per cent in 2022, a
slight decrease from the 4.6 per cent growth
recorded in 2021. The projection for the region
reflects the cushioning effects of rising fossil fuel
and metal prices for some commodity-exporting
countries.
Consumer Prices: Global inflation is expected to
remain elevated in 2022 due to rising food and
energy prices and lingering supply chain
disruptions. The IMF projections, however,
suggest a subdued inflation outlook in the nearterm on the back of the central banks’ tightening
policy stance.
In advanced economies, prices are generally
projected to rise in 2022, reflecting the impact of
the
Russia-Ukraine
war
on
energy
and
commodity prices. In the United States, inflation
is expected to stand at 7.7 per cent from 7.0 per
cent at end-December 2021, while in the euro
area, inflation is projected at 7.3 per cent. In the
United Kingdom and Japan, inflation is projected
at 10.5 per cent and 1.9 per cent, respectively,
from 4.8 per cent and 0.8 per cent recorded at
end-December 2021.
Inflation in EMDEs will continue to trend
northward in 2022. In Asia, it will stand at 3.5 per
cent and particularly, in China, consumer prices
are expected to grow by 2.1 per cent.
In sub-Saharan Africa, inflation is projected at
12.2 per cent in 2022, occasioned primarily due
to rising food and energy prices.

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DOMESTIC ECONOMIC OUTLOOK
Nigeria’s output growth is expected to maintain a
positive trajectory for the rest of the year. The
growth prospects are dependent on continued
policy support and sustained increase in crude oil
prices. Specifically, the Nigerian economy is
estimated to grow in 2022 by 3.52 per cent (CBN),
4.20 per cent (FGN), and 3.40 per cent (IMF). The
positive outlook is predicated on the effective
implementation of the 2022 Appropriation Act
and the 2022-2025 Medium-Term National
Development Plan (MTNDP), and the continued
interventions by the CBN in growth-enhancing
sectors.
The uncertainties from the Russia-Ukraine war,
as well as significant headwinds, such as rising
energy prices, the risk of stagflation in the US,
and the persisting security and infrastructural
challenges, could undermine the positive outlook
in the short-to-medium-term.
Domestic prices are expected to remain elevated
through the second half of 2022. This is on the
back of expected build-up in 2023 electionrelated spending, spillovers from global supply
constraints, and exchange rate pass-through.
More
so,
the
persisting
security
and
infrastructural challenges could exacerbate
inflationary pressures.
However, inflation is expected to decelerate in
the coming months given the expected good
harvest season and the sustained interventions
of the Bank in the real sector of the economy.
The outlook of the external sector remains
optimistic, on account of expected favourable
terms of trade. The positive outlook is supported
by the sustenance of crude oil price above
US$100.00pb and the gains from the Naira-4dollar and the RT200 programmes of the Bank.
However, the hike in interest rate by central
banks across advanced economies increases the
risk of capital outflow. Also, the rising external
debt-servicing, are likely to weigh on external
reserves accretion.

Fiscal conditions are expected to improve in the
second half of 2022. This is premised on
continued implementation of the Finance Act
2021, the Strategic Revenue Growth Initiatives
(SRGIs), and tax reforms, which are expected to
boost non-oil revenue. Rallying crude oil prices,
arising from Russia-Ukraine crisis, are likely to
boost oil earnings. However, low domestic crude
oil production, rising public debt and lingering
security challenges are likely to pose downside
risks to fiscal outcomes.
The financial sector is expected to remain resilient
in the second half of 2022. The outlook mirrors
the efforts of the CBN in continuously monitoring
emerging vulnerabilities and risks, including
periodic stress tests, and the provision of risk
mitigants.

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Section Five


An addendum of supporting activities and engagements of the
Bank, in the review period is presented here.

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❖ International Meetings
• Regional
• Non-Regional

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5.1 REGIONAL MEETINGS
44th Meeting of the Committee of Governors of
the Central Banks of the West African Monetary
Zone Member States.
The 44th meeting of the Committee of Governors
of the Central Banks of the Member States of the
West African Monetary Zone WAMZ was held
virtually on 3 March 2022. The Meeting was held
to deliberate on the status of the implementation
of the WAMZ work programme and activities
under the ECOWAS single currency programme.
The reports of the 50th meeting of the Technical
Committee formed the basis of deliberations and
consideration.
The Meeting considered the following aspects of
the report:
•
WAMZ Macroeconomic development and
convergence report, end-June 2021;
•
Diagnostic report on the harmonization of
statistics in the WAMZ member states;
•
Proposed Roadmap for WAMZ countries
migration
to
Inflation
Targeting
Framework;
•
Progress report on the Capital Markets
Integration and Insurance Industry in the
WAMZ;
•
Progress report on the Payments System
Development in the WAMZ; and
•
Proposed West African Monetary Institute
(WAMI) Work Programme and budget for
FY 2022.
The Committee of Governors made the following
observations:
•
The need to convene a technical seminar
on the dynamics of NPLs control and
management in the WAMZ;
•
The need for the establishment of a
regional harmonized supervisory and
regulatory framework, considering crosscountry peculiarities, such as shocks, for
the resolution of high NPLs within the
WAMZ; and
•
Member Central Banks shared diverse
experiences on banking supervision and
regulatory
practices,
policies,
and
measures for managing NPLs.
The Committee of Governors further endorsed the
recommendations submitted by the Technical
Committee.
50th Meeting of the Technical Committee of
the West African Monetary Zone
The 50th Meeting of the Technical Committee of
the WAMZ was held virtually from 28 February to
2 March 2022. The Meeting deliberated on the
status of implementation of the WAMZ work
programme and activities under the ECOWAS
single currency programme at end-June 2021. The
basis for consideration was the technical
documents of the WAMI.
The
Meeting
made
presentations
and
discussions on the following:
•
WAMZ Macroeconomic Development and
convergence report, end-June 2022;
•
Diagnostic report on the harmonisation of
statistics in the WAMZ member states;
•
Proposed roadmap for WAMZ countries’
migration to Inflation Targeting (IT)
framework;
•
Financial integration issues (Payments
system, capital market integration, and
insurance sector development); and
•
Administrative
issues
(WAMI
work
programme and budget for FY 2022)

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The Technical
Committee
deliberated
and
adopted the reports and made necessary
recommendations.
WEST AFRICAN MONETARY AGENCY
The 40th Ordinary Meeting of the Joint Technical
Committee (Economic and Monetary Affairs
Committee,
Operations
and
Administrative
Committee) of WAMA.
The 40th Meeting of the Joint Technical Committee
of the West African Monetary Agency (WAMA)
was held virtually during 24-26 February 2022. The
Meeting considered and adopted the following
reports:
•
Director General’s progress reports for
the second half of 2021;
•
ECOWAS Macroeconomic convergence
report for the first half of 2021;
•
Macroeconomic impact of the COVID-19
pandemic in ECOWAS;
•
The impact of policy measures adopted to
mitigate the impact of COVID-19 and its
implications for the stabilisation phase of
the ECOWAS Monetary union;
•
Reserve pooling in the proposed ECOWAS
single currency area (Update);
•
Implementation
of
the
ECOWAS
payments and settlement system (EPSS)
project (update);
•
Exchange rate developments in the
ECOWAS as of 31 December 2021;
•
Transition to a flexible exchange rate
regime: Strategic Considerations;
•
WAMA work programme for 2022;
•
Proposed budget for 2022; and
•
Harmonisation
of
terminal
benefits,
standardisation of provident fund scheme
and harmonisation of staff benefits:
WAMA, WAMI, West African Monetary
Agency (WAIFEM).
Fourth Ordinary Meeting of the Audit Committee
of WAMA
The 4th Ordinary Meeting of the Audit Committee
of the WAMA was held virtually on 23 February
2022 and was presided over by the Central Bank
of Nigeria.
The reports considered at the meeting included:
•
Review of the evaluation committee for
the appointment of an external auditor
for WAMA for the Financial Year ended 31
December 2021;
•
Review of the updated rules and
regulations of WAMA; and
•
Internal audit report for the periods July
to December 2021.
The Committee unanimously considered and
adopted the reports.

5.2 NON-REGIONAL MEETINGS
Fitch Rating Agency in February 2022 Confirmed
Nigeria's Long-Term Foreign-Currency Issuer
Default Rating (LTFC IDR) at B with a Stable
Outlook
The following were highlights of the review:
•
Institutional weakness is a long-term
credit constraint: Fitch acknowledged that
compared with her peers, Nigeria had
been able to develop a pension system
and relatively deep capital market and
had experienced peaceful transitions of
power. However, it assessed fiscal policy
effectiveness
as
weak,
which
was
reflected in the government's inability to

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expand
the
non-oil
revenue
base
significantly
thereby
exposing
the
economy to further shocks;
•
Weak monetary and macroeconomic
performance: Fitch noted that inflation
had been relatively volatile;
•
Existing financial buffers were almost
entirely
depleted:
Nigeria's
existing
financial buffers, the Excess Crude
Account (ECA) and the Nigerian Sovereign
Investment
Authority
(NSIA),
were
assessed as too small to form a credible
policy hedge against protracted oil price
volatility or shocks;

•
Domestic liquidity risk remained under
control:
Fitch
acknowledged
the
government’s ability to assess the
domestic capital markets to finance its
deficits. Government bonds were by far
the largest component of the debt
markets (excluding CBN certificates). It
was observed that local banks and
pension funds held most government
debt, which remained relatively liquid;
and

•
External liquidity risk remained limited:
The rating agency observed that the
Federal Government’s external debt was
relatively small at around 9.0 per cent of
GDP and around 29.0 per cent of general
government debt as of 2021.

African Union Summit
The 35th African Union (AU) Summit took place in
February 2022. The 40th Ordinary Session of the
Executive Council (Ministerial Session) took place
on 2-3 February and the 35th Ordinary Session of
the African Union Assembly (Heads of State and
Government Session) took place from 5-6
February 2022.

❖ The African Continental Free Trade
Agreement (AfCFTA) gained center stage
at the 35th AU submit. There was an
agreement on origin rules.
6th Summit of the European Union and African
Union Heads of State and Government
The Sixth Summit of European Union (EU) and
African Union Heads of State and Government was
held in Brussels on 17-18 February 2022. The
Summit issued a “Joint Vision for 2030” that aims
to consolidate a “renewed partnership” between
the two continents to further strengthen the
solidarity, security, peace, and sustainable
economic development and prosperity for citizens
and future generations, bringing together the
people, regions, and organizations. The Summit
promised an investment package of €150.00bn for
Africa over the next seven years.
African Development Bank
The African Development Bank Group (AfDB) and
Africa, in partnership with the African Union
Commission and the African Union Development
Agency
(AUDA-NEPAD),
are
exploring
collaboration with global partners to create an
Alliance for Green Infrastructure in Africa. AfDB
President, Dr. Akinwumi A. Adesina made the
announcement on 17 February 2022 while
speaking at a thematic roundtable on climate
change and energy transition at the 6th European
Union-African Union Summit in Brussels, Belgium.
The European Investment Bank, Bank for
Reconstruction and Development, the French
Development
Agency
and
The
Rockefeller
Foundation have expressed their interest in
joining the Alliance. It is globally acknowledged

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that climate change continues to devastate
Africa’s economies and the livelihoods of its
people,
despite
the
continent’s
minimal
contribution to greenhouse gas emissions. Climate
change has taken lives, caused food insecurity,
displaced
populations,
damaged
critical
infrastructure,
and
disrupted
economies.
Moreover, increased geopolitical tensions could
further threaten livelihoods and stability.
The Alliance for Green Infrastructure in Africa is
expected to complement, enhance, and partner
with continental and global initiatives to crowd in
private capital to fund green infrastructure
projects. The idea is to bridge investment gaps and
engender financing at scale and with speed. The
Alliance’s overarching goal will be to leverage the
private
sector
to
transparently
develop
transformative infrastructure that sustainably
bridges Africa’s infrastructure deficit in a climateresilient manner.
G-24 Technical Group Meeting Session on "Central
Bank
Digital
Currencies:
Implications
on
Developing Countries.
The G-24 Technical Group Meeting was held
virtually on 10 March 2022. The Meeting
discussed the implications of the Central Bank
Digital
Currencies
(CBDCs)
on
Developing
Countries. The meeting discussed the potential of
these innovations in enhancing financial access, as
well as associated risks to financial stability. One of
the presentations focused on the Central Bank of
Nigeria’s perspectives on the benefits and
challenges of developing CBDCs.
Central Banks across the world have started to
consider issuing digital currencies to enhance
businesses and households seeking faster, safer,
easier, and cheaper means of payments. A 2021
survey of Central Banks by the Swiss-based Bank
for International Settlements (BIS) found 86.0 per
cent of banks in active research for CBDCs
potential, 60.0 per cent experimenting with the
technology and 14.0 per cent deploying pilot
projects on CBDCs.
With the launch of the Central Bank of Nigeria’s
digital currency ‘’e-Naira” on 25 October 2021, a
new level of engagement and collaboration
among players in the payments and financial
services value chain in Nigeria was stimulated. The
meeting further discussed the growing feedback,
highlights, and challenges so far since the launch
of the e-Naira.
2022 Spring Meetings of the Boards of Governors
of the International Monetary Fund/The World
Bank Group, 18-24 April 2022.
The 2022 Spring Meetings of the Board of
Governors of the World Bank Group (WBG) and
the International Monetary Fund (IMF) were held
physically and virtually from 18-24 April 2022. The
Honourable Minister of Finance, Budget, and
National Planning, Ms. Zainab Ahmed, led the
Nigerian delegation to the meetings.
The sidelines meeting of the Inter-Governmental
Group of Twenty-Four (G-24) on International
Monetary Affairs and Developments was held at
the same period. The G24 Ministers expressed
sadness at the tragic deaths and devastation in
Ukraine and strongly supported international
efforts to provide humanitarian support and
restore peace and stability and recognised that
the crisis compounds and intensifies risks and
undermines economic recovery worldwide.
The G24 Ministers noted that the pandemic had
imposed huge costs. Many impediments to the
global recovery remained, with growth prospects
increasingly divergent and uncertain. GDP growth
over the medium-term in many emerging markets
and developing economies (EMDEs) was projected
to fall below pre-pandemic levels. Urgent global

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action was needed to prevent hunger and food
crises among vulnerable countries and poorer
households and avert financial distress in highly
indebted EMDEs.
The G24 Ministers expressed concern about
increasing risks to financial stability that may
disrupt the economic recovery. In managing the
exit
from
accommodative
macroeconomic
policies, policymakers need to strike a balance
between
containing
surging
inflation
and
supporting economic recovery. Higher than
expected increase in interest rates in advanced
economies could raise rates globally and trigger
capital outflows from developing countries,
reducing access to financial markets, and further
increasing debt vulnerabilities.
The
International
Monetary
and
Financial
Committee (IMFC) noted that the recovery of the
global economy continued but has slowed down
owing to new COVID-19 variants and setback from
the Russia-Ukraine war and its ramifications,
which could amplify existing challenges. The
resulting surge in energy and food prices has
added to inflationary pressures, while supply
disruptions have further intensified, and financial
markets and capital flows are exhibiting increased
volatility.
Against the backdrop of current uncertainties, the
Committee pledged to intensify efforts to achieve
the goal of a more resilient, sustainable, and
inclusive global economy, while remaining fully
committed to fostering multilateral cooperation. It
reiterated its strong commitment to further
accelerate climate action in line with the Paris
Agreement, considering country-specific factors,
and looked forward to strong ambition for the
Conference of Party (COP27), including enhanced
action on adaptation and resilience.
The
Committee
welcomed
the
Managing
Director’s Global Policy Agenda. In the context of
current
stress
in
the
macroeconomic
circumstances and outlook, the Committee looked
forward to the IMF’s swift and vital real-time and
granular support to members through its tailored
cutting-edge policy advice, timely financial
support, and targeted capacity development in
close
and
effective
collaboration
with
international partners.
The Committee supported the IMF’s increased
surveillance focus on risk analysis and contingent
policy advice; and its efforts to continue
strengthening
multilateral
surveillance
and
analytical work on pressing policy issues, including
inflation and its drivers, policy mixes and
international spillovers, financial, external, and
corporate sector vulnerabilities, fiscal adjustment,
scarring from the pandemic, and inequality.
International Monetary Fund Staff Visit
The International Monetary Fund (IMF) staff
visited the country from 8-11 June 2022 and had
discussions with key stakeholders including the
Central Bank of Nigeria.
The IMF delegation from Washington had an
opening meeting with the Governor and
consultations with various departments of the
Bank during this visit.
The meetings were for the IMF to gain more
insight into recent developments in the Nigerian
economy. The CBN responded to questions
surrounding; Development Finance, Central Bank
Digital Currency (e-Naira), Cash flows, and Balance
of Payments.
7th Africa-Ireland Economic Forum
Seventh Africa - Ireland economic forum themed
‘’Prospering
Post-Pandemic:
Towards
a
Sustainable, Greener Future” was held in Dublin

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on 30 June 2022. Dr. Akinwumi A. Adesina,
President of the African Development Bank Group,
and Ambassador Mariam Katagum, Minister of
State, for Industry, Trade and Investment of
Nigeria,
delivered
keynote
address.
Issues
deliberated upon at the event included regional
trade, green growth in the agriculture, food and
energy
sectors,
women’s
economic
empowerment, and how technology, innovation,
and entrepreneurship are being leveraged for
Africa’s growth.