The Central Bank of Nigeria Governor, Olayemi Cardoso said the federal government spent N6.2 trillion on foreign exchange subsidy in 2022 alone compared to N4.5 trillion spent on fuel subsidy.
Cardoso disclosed this in a recent 59th annual Bankers Dinner of the Chartered Institute of Bankers of Nigeria, CIBN, in Lagos.
According to him, in the past years, FX subsidy losses have been a bigger problem for the country’s revenue than fuel subsidies.
“In 2022 alone, the potential revenue total revenue lost due to a less reflective FX regime is approximately N6.2 trillion compared to 4.5 trillion from fuel subsidies.
“We have all been complaining about the loss of government revenue from fuel subsidies, yet the loss from the past FX subsidy regime far exceeds that of fuel.
“The real elephant in the room is the losses from the FX regime.”.
Recall that in June last year, the Nigerian government had announced Naira floating and fuel subsidy removal.
The twin policies had a lag impact on Nigeria’s economy as inflation stood at 33.88 percent and the exchange rate at N1672.69 per dollar from 22.41 percent and N463 between May and June 2023.