ABUJA, Nigeria (CHATNEWSTV) — Nigeria and China have renewed a 15 billion yuan (about $2.2 billion) currency swap agreement aimed at enhancing trade and investment between the two nations. The agreement, worth NGN 3.28 trillion, seeks to reduce reliance on the U.S. dollar, mitigate financial risks, and strengthen economic ties.
Joseph Tegbe, Director-General of the Nigeria-China Strategic Partnership, described the agreement as a significant milestone in bilateral relations.
“This renewal underscores the deepening financial cooperation between our two nations and expands the use of the naira and yuan in direct transactions,” Tegbe said.
Strengthening Economic Ties
The currency swap arrangement, initially signed in 2018, facilitates direct settlement of trade transactions in Chinese yuan (CNY) and Nigerian naira (NGN). The initiative is expected to reduce transaction costs and protect businesses from exchange rate volatility.
“With trade between Nigeria and China valued at N7.38 trillion as of June 2024, China remains Nigeria’s top trading partner,” Tegbe added. “This agreement will further drive economic growth and open new opportunities for businesses in both countries.”
Supporting Nigeria’s Economic Agenda
The renewal aligns with President Bola Ahmed Tinubu’s efforts to implement economic reforms and attract foreign investment. Analysts say the agreement provides businesses with more financing options and fosters financial market stability.
“It’s a win-win for Nigeria,” said financial analyst Abdullahi Musa. “Reducing dependence on the dollar strengthens economic independence and creates a more stable trade environment.”
The Central Bank of Nigeria, which has been instrumental in facilitating the agreement, emphasized its commitment to fostering economic cooperation with China.
“This partnership is a step toward building a resilient and globally competitive economy,” a central bank spokesperson said.
A Growing Strategic Partnership
The currency swap renewal reflects a broader strategic relationship between the two nations. Recent initiatives under the Nigeria-China Strategic Partnership have bolstered financial ties, reinforcing China’s position as a critical ally in Nigeria’s economic transformation.
“This partnership is more than symbolic—it’s practical,” Tegbe said. “We are paving the way for a prosperous future driven by collaboration and shared growth.”
