By Jemimah Wellington, JKNewsMedia Reporter
A $2 BILLION currency swap agreement, equivalent to 15 billion yuan, has been renewed to enhance bilateral trade, boost investment, and strengthen cooperation between Nigeria and China.
The People’s Bank of China (PBOC), in a statement released on Friday, confirmed that the arrangement would be extended for another three years, with provisions for renewal by mutual agreement.
The agreement facilitates the direct exchange of the Chinese yuan and Nigerian naira, reducing reliance on the US dollar and lowering transaction costs in bilateral trade.
The currency swap framework was initially established in May 2018 when the suspended Governor of the Central Bank of Nigeria (CBN), Godwin Emefiele, and the former Governor of the People’s Bank of China, Yi Gang, had signed the deal valued at renminbi (RMB) 16 billion (approximately $2.5 billion).
The agreement was designed to enable industrialists and businesses in both countries to access yuan and naira directly, reducing dependence on third-party currencies.
Emefiele had remarked at the time, “This agreement will provide naira liquidity to Chinese businesses and RMB liquidity to Nigerian businesses, thereby improving the speed, convenience, and volume of transactions between the two countries.”
