…Similarly, we note an increase in direct remittances (+28.5% y/y to USD841.37 million) underpinned by increased payments for international services by Nigerian resident
SAT AUG 10 2024-theGBJournal|Based on data released by the CBN, international payments by the apex bank increased by 30.8% y/y to USD3.31 billion in 5M-24 (5M-23: USD2.53 billion).
Breaking it down, foreign debt service and payments increased by +96.3% y/y to USD2.19 billion and accounted for 66.1% of total international payments.
Similarly, we note an increase in direct remittances (+28.5% y/y to USD841.37 million) underpinned by increased payments for international services by Nigerian residents.
Meanwhile, payments for letters of credit fell by 63.3% q/q to USD279.99 million (5M-23: USD762.03 million), partly attributable to reduced consumer demand underpinned by high inflationary pressures as well as the depreciation of the naira.
Looking forward, analysts at Cordros Research say they expect international payments to remain elevated, supported by the FG’s repayment of maturing debts primarily from Multilateral and Bilateral sources as well as interest payments.
Elsewhere, we anticipate trade imports to improve in the short term due to reduced naira depreciation and the FG’s 150-day import duty removal on certain agricultural produce, potentially increasing international payments.
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