Nigeria’s Central Bank has implemented a significant policy shift by suspending all approvals for extended export proceeds repatriation, marking a decisive move to strengthen foreign exchange regulations and ensure timely return of export earnings. The directive, which took effect immediately following a January 8, 2025 circular, affects both oil and non-oil export transactions across the country.
W.J. Kanya, acting Director of CBN’s Trade & Exchange Department, issued the circular outlining strict timeframes for export proceeds repatriation. Oil and gas exporters must now comply with a 90-day deadline from the bill of lading date, while non-oil exporters face a 180-day timeline to repatriate their earnings into designated domiciliary accounts.
The policy change references the Foreign Exchange Manual’s revised 2018 edition, specifically citing Memorandum 10A (23a) and Memorandum 10B (20a) as the regulatory foundation for this decision. This move represents a significant tightening of foreign exchange controls and signals the central bank’s determination to maintain strict oversight of export revenues.
The suspension of extension approvals marks a departure from previous practices where exporters could request additional time to repatriate their earnings. This flexibility had been available through Authorized Dealers, but the new directive eliminates this option, requiring strict adherence to the established timeframes.
This policy shift comes amid broader efforts by Nigerian monetary authorities to stabilize the foreign exchange market and ensure better tracking of export proceeds. By enforcing stricter repatriation timelines, the CBN aims to improve foreign exchange liquidity and strengthen the country’s external reserves position.
The impact of this decision will be particularly significant for Nigeria’s export sector, which includes both major oil companies and numerous non-oil exporters. These businesses must now adjust their operations and financial planning to accommodate the rigid repatriation deadlines, potentially affecting their cash flow management and international trade arrangements.
For the oil and gas sector, which represents a substantial portion of Nigeria’s export earnings, the 90-day repatriation requirement could lead to significant operational adjustments. Similarly, non-oil exporters across various industries must now ensure their payment collection and repatriation processes align with the 180-day deadline.
The banking sector, particularly Authorized Dealers who previously facilitated extension requests, will need to modify their export proceeds monitoring systems to ensure compliance with the new directive. This change may require enhanced tracking mechanisms and closer coordination with their export clients to meet the stipulated deadlines.
The CBN’s decision reflects a broader strategy to strengthen Nigeria’s foreign exchange management framework and ensure that export earnings contribute effectively to the country’s foreign exchange reserves. By eliminating extensions, the central bank aims to create a more predictable and efficient system for managing export proceeds.
This development may also influence how Nigerian exporters structure their international trade agreements, potentially leading to shorter payment terms and more stringent contractual arrangements with overseas buyers to ensure compliance with the repatriation deadlines.
As the policy takes effect, its success will largely depend on the ability of exporters to adapt their operations and the effectiveness of monitoring mechanisms put in place by both the CBN and Authorized Dealers. The coming months will reveal whether this stricter approach achieves its intended goals of improving foreign exchange availability and strengthening Nigeria’s external sector management.
