Nigeria’s external reserves climbed to $49 billion in February 2026, according to Central Bank Governor Yemi Cardoso, marking the development a milestone in the country’s foreign exchange position.
Oil receipts and CBN policy reforms under the current governor’s leadership since 2023 have been key to these inflows.
Still, experts say diaspora remittances are quietly becoming a more reliable FX driver than the crude oil revenue.
The shift, according to sources, raises a question: whether the country is trading one dependency for another as the “Japa phenomenon” reshapes the country’s foreign exchange architecture.
According to World Bank data, Nigeria received almost US $19.5 billion in remittance inflows in 2023, which was about 35% of remittances to sub-Saharan Africa that year.
In 2024, there was more than 8% increase from the previous year, and it rose to about US $20.98 billion. The country reached what experts thought was “the highest level for a very long time” in 2025 when remittance inflows into Nigeria reached US $23 billion.
Over 70% of Nigeria’s diaspora remittances originate from three Western economies: the United States, the United Kingdom, and Canada. Recent CBN reforms, including the formalisation of International Money Transfer Operations, have improved transparency and monitoring of these inflows. However, experts warn that Nigeria risks a 15-20% decline in remittances should the country experience global shocks such as another pandemic or recession.
What they are saying
Dr Gbadebo Salako, an academic researcher on development and international economics, suggests that “the rapid increase we are experiencing is the positive effect of having more skilled Nigerians earning abroad under a traceable FX system”.
Marcel Okeke, former Chief Economist at Zenith Bank Group, says the mass exodus of skilled Nigerians in diaspora is directly reshaping the country’s foreign exchange inflows and warrants closer macroeconomic scrutiny. Unlike previous waves of migration driven by unskilled labour, today’s emigrants are predominantly professionals entering high-earning sectors abroad and generating substantial remittance flows back home.
- “You know, there’s what is called the JAPA phenomenon in Nigeria. Because of economic challenges in our country, so many people are leaving for the USA, Canada, the UK, and other countries. So when they go there, the rest of the family remaining in Nigeria depends on what they bring in,” Okeke told Nairametrics.
- “A lot of people are leaving the country in this present age, especially the younger generation. Some of them even have undergraduate and graduate degrees. These people go out in droves and become professionals outside. They are not rogues. They are real professionals.”
- On whether remittances now provide superior FX stability compared to oil, Okeke responded: “That can be said, yes, because the price of oil keeps going up and down because of global tension. You don’t know what will happen between Russia and Ukraine, you don’t know what will happen between the US and so many other countries.”
- “But for remittances, as of now, it will keep going up, I believe. And I can tell you that it is already substantial and it will keep getting better,” he added.
Okeke noted that CBN reforms requiring International Money Transfer Operators to route transactions through official channels have strengthened monitoring capabilities and reduced informal dollar flows.
Backstory
Nigeria’s oil revenues have long been exposed to geopolitical effects, OPEC+ production rules, and volatile global demand patterns. Petroleum earnings continue to fluctuate amid conflicts between countries around the world. Experts opine that the conflicts make international oil markets unreliable for economic planning.
Salako, who has been researching falling oil prices, Nigeria exchange rate volatility and macro-economic variables and even co-authored a paper in the Journal of Investment and Management on the subject, told Nairametrics that “since oil revenues are becoming unreliable day by day, diaspora remittances have almost become our unexpected stabiliser. With the surging foreign-exchange inflows we have now, we may not depend solely on crude oil revenue to carry our economy.”
- Remittances, in contrast, are anchored in diaspora earnings across diversified economic sectors and labour markets in multiple countries.
- The formalisation of remittance channels through CBN directives has increased official inflow monitoring while reducing black market dollar transactions.
- “For instance, you cannot just throw a dollar into your family,” Okeke explained. “When they encourage people to bring money in through official channels rather than unofficial channels, they will be able to monitor the inflows.”
This shift from oil dependency to remittance reliance represents a fundamental transformation in Nigeria’s external revenue structure, driven largely by citizens seeking economic opportunities abroad.
What this means
Nigeria’s heavy reliance on remittances from just a few Western economies, notably the United States, the United Kingdom, and Canada, creates a quiet vulnerability. Sources say many Nigerians in these countries have naturalised or hold dual citizenship, which offers some cushion. But with increasingly restrictive immigration policies, the wave of workers and future remittance flows may become limited.
The United States has tightened H-1B visa pathways and increased deportation enforcement under the Trump administration.
The UK introduced stricter skilled worker requirements in 2024, making lawful migration more difficult.
- “Take, for instance, President Donald Trump’s brand of nationalization or America First agenda. There is a deliberate effort to stop people from other parts of the world, most especially Africans, from entering the US.
- “This kind of agenda could go around because the world is a global village. When such an agenda goes around, our remittances will definitely be affected. That will happen and is already happening,” Okeke warned.
Remittances appear more stable than oil revenues but carry their own risks, particularly from global economic shocks such as the COVID-19 pandemic. Such a shock could disrupt international labour markets and reduce earnings for diaspora workers.
What you should know
The country’s external reserves, which reached $49 billion as of February 2026, are a positive sign of the country’s external buffers under Governor Cardoso’s leadership. Sources believe this came into being owing to improved oil receipts and the formalisation of remittance flows that had previously been outside the government’s official monitoring channel.
- The CBN’s International Money Transfer Operations framework has increased transparency in diaspora inflows since its implementation.
- Experts estimate that Nigeria could face a 15-20% decline in remittances during severe global economic shocks, such as the COVID-19 pandemic.
- “When COVID came, nobody ever expected that kind of global devastation. Should anything close to that happen again globally, Nigeria has a lot of vulnerabilities as a result of foreign exchange or foreign income,” Okeke added.
According to Salako, it is not “totally” safe for Nigeria to depend on its economic gains on what happens in the countries that are doing everything they can to reduce migration numbers, whether or not they are skilled or unskilled.
Without improvements in our domestic economic conditions, Nigeria’s reliance on citizens earning abroad is likely to replace oil concentration risk with diaspora dependency. Experts conclude that this will leave the country vulnerable to immigration policy shifts and global economic shocks beyond its control.
