Nigeria’s FX Float: Has Government Gained While the Economy Loses?

After reviewing Nigeria’s foreign-exchange policy since the naira was floated in 2023, I believe the policy has improved government revenue and some macroeconomic indicators. However, I do not see enough evidence that it has translated into broad-based prosperity for Nigerians. Nigeria’s GDP growth has remained within the 3–4% range despite the major exchange-rate adjustment. Meanwhile, the naira’s depreciation has raised the cost of imported goods, machinery and production inputs, weakened household purchasing power and increased pressure on businesses. FAAC exchange-rate gains reportedly ran into several trillions of naira between 2023 and 2025. My estimate is that wider fiscal gains may exceed ₦12 trillion, while the economy may have lost more than ₦50 trillion through higher costs, reduced productive capacity and weaker investment. That suggests the economy could be losing about ₦4 for every ₦1 gained by government. I am not arguing that Nigeria should automatically abandon a floating exchange rate. Rather, government should channel FX-related revenues into electricity, transport, industrial infrastructure, domestic manufacturing and productive capital. The real test is whether the policy makes Nigeria more productive, competitive and prosperous.

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