Cardoso’s monetary reforms earn global praise

Cardoso’s monetary reforms are restoring investor confidence, stabilising the naira and earning global recognition for Nigeria’s central banking leadership

[dropcap]C[/dropcap]ardoso’s monetary reforms are now reshaping Nigeria’s financial trajectory and gaining global recognition, less than two years after President Bola Tinubu appointed Olayemi Cardoso as Central Bank Governor.

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When he assumed office in September 2023, Nigeria faced surging inflation, a volatile exchange rate, and dwindling investor trust.

Cardoso swiftly launched a series of bold, targeted reforms aimed at restoring macroeconomic stability and transparency in Nigeria’s monetary system.

At the 2025 African Banker Awards in Abidjan, Cardoso was named Central Bank Governor of the Year, commended for his leadership in stabilising the naira, clearing foreign exchange backlogs, and reinforcing institutional credibility.

The award is seen as a testament to the effectiveness of Cardoso’s monetary reforms and Nigeria’s return to global financial respectability.

Upon his appointment, inflation stood at 33.88%, and the naira was struggling under the weight of a $7 billion forex backlog.

The Central Bank had been burdened by excessive Ways and Means advances to the federal government, while FX arbitrage and multiple exchange rates eroded market confidence.

Cardoso inherited a system in disarray, yet moved quickly to unify exchange rates, restore FX market transparency, and reinforce regulatory discipline.

Cardoso’s approach centred on transparency, market realism, and policy coordination. Notable reforms included:

Exchange Rate Unification: The naira was allowed to float under a willing-buyer, willing-seller system, ending years of parallel market distortions.

Clearing the FX Backlog: By settling foreign exchange obligations, the CBN rebuilt international investor trust.

Tightening Monetary Policy: Benchmark interest rates were raised to attract capital inflows and curb inflation.

Restoring trust in the naira wasn’t just about policy—it was about integrity, transparency, and accountability.

Crackdown on FX Speculation: New rules and capital requirements for Bureau de Change operators were implemented to reduce market manipulation.

FX Code of Conduct: Introduced in 2025, it mandated professionalism and ethical trading practices across the FX market.

Bank Recapitalisation: New thresholds (N500bn for international banks, N200bn for national banks) were introduced to fortify the banking system.

The impact of Cardoso’s monetary reforms is clear.

FX liquidity has improved, the naira’s volatility has moderated, and portfolio investment inflows more than doubled to $13.35bn in 2024.

Nigeria recorded a $6.83bn Balance of Payments surplus in 2024, reversing two years of deficits.

Foreign reserves rose by $6bn to $40.19bn, while remittance inflows and non-oil exports posted double-digit growth.

President Tinubu recently confirmed over $30bn in foreign investor commitments, a sign of renewed global faith in Nigeria’s economic direction.

The African Banker Awards jury praised Cardoso for delivering the most comprehensive reforms since the 2004 banking overhaul.

They cited his “strategic leadership in re-establishing the credibility of the Central Bank and laying a foundation for long-term resilience.”

Cardoso’s monetary reforms mark a clear break from opaque and ineffective past policies.

By prioritising transparency, market integrity, and investor confidence, Nigeria is now positioned for sustainable growth.

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His recognition as Central Bank Governor of the Year is not only a personal milestone but also a signal that Nigeria’s macroeconomic policies are setting a new standard for African economies.