• Tuesday, May 21, 2024
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BusinessDay

Dollar demand for education, health up $1.8bn in 9 months

CBN raises import duties FX rate to N1,457/$

Dollar supply for foreign educational and health-related expenses from the Central Bank of Nigeria rose by 49.22 percent to $1.81 billion in the nine months spanning January to September 2023.

According to CBN data, Nigeria’s spending on overseas health-related issues and foreign education increased marginally to $1.81 billion from $1.76 billion in the corresponding period of 2022.

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The dollar supply for these two expenses paled in comparison to the $2.49 billion available in the corresponding period of 2021. In an explanatory note titled Note D, the apex bank defined Balance of Payments as “a systematic record of economic and financial transactions for a given period between residents of an economy and non-residents.”

Poor health infrastructure has been cited as one of the reasons why Nigerians travel abroad for proper health services, and a failing educational system and economic downturn have been responsible for the increasing appetite for foreign education despite falling dollar reserves.

In recent years, dollar supply to Nigeria has fallen because of a decline in foreign investments, crude oil output shortage, and decreasing diaspora remittances.

Olayemi Cardoso, governor of the Central Bank of Nigeria (CBN), recently noted that medical tourism and the growing number of Nigerians studying abroad are two significant components of the country’s demand for foreign exchange despite the fall in dollar supply.

Speaking before the House of Representatives, Cardoso disclosed that Nigerians spent over $40 billion to access education and healthcare abroad in ten years between 2010 and 2020.

He said, “Looking at the demand side of the exchange rate, it’s important to note the growing number of Nigerian students studying abroad. According to UNESCO’s Institute of Statistics, the number of Nigerian students abroad increased from less than 15,000 in 1998 to over 71,000 in 2015. By 2018, this figure had reached 96,702 students, as per the World Bank.”

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A report from the Washington-based Institute of International Education in 2023 revealed that the number of Nigerian students in US colleges and universities grew by 22.2 percent to 17,640 in the 2022/23 academic year from 14,438 the previous year.

An analysis of the report revealed that the number of Nigerians in the US grew faster than in 2022. The institute’s report highlighted that Nigeria was the only African country among the top 10 countries with the highest number of students in America.

According to experts, travel for medical reasons is because of a lack of confidence in the medical facilities and inadequate medical equipment.