Naira’s Depreciation Complicates Nigerian Students’ Plans to Study Abroad

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Naira's Depreciation Complicates Nigerian Students' Plans to Study Abroad

Nigerian students planning to study abroad should brace themselves for increased uncertainty. The Nigerian Naira has hit a new low this week, with some online sources reporting its fall to 710 Nairas per US dollar – the currency’s worst loss to date. Since Monday, the numbers have slowly declined, reaching N670 per dollar on Wednesday before settling at their current level.

To add salt to the wound, long wait times for the Central Bank of Nigeria (CBN) to accept cash transfers at a discounted rate put students enrolled at foreign universities at risk of missing payment deadlines for the upcoming Fall academic semester. With high inflation rates and a Nigerian currency that is falling by the day, students quickly resorted to social media to vent their concerns.

The naira fell at a time when the US dollar was experiencing its best performance in a generation, causing ripple effects in currencies around the world. In Nigeria’s instance, a falling currency’s value on the world market is merely one component of a much wider issue that could lead to a statewide economic catastrophe.

According to Nairametrics, a hike in money supply was identified as one of the reasons for the current depreciation of the Nigerian currency, based on data retrieved from the central bank. Since 2020, the country’s money supply has skyrocketed by 69% against a slow growth in its nominal gross domestic product (GDP), the financial news site reports.

Dollar constraint in the CBN’s reserve leads to delays in foreign transactions to settle university fees for Nigerian students studying abroad. According to The PIE News, people who want to fly overseas for their studies can access the CBN’s discounted rate window and exchange up to US$15,000 per semester through the central bank’s RT200 FX scheme.

Because of transaction delays and the Nigerian currency crisis, agents and students believe the concessionary window may close shortly. Simply put, the fees of obtaining a foreign degree may now be extremely costly.

As the Nigerian currency continues to fall, a significant brain drain problem threatens to exacerbate the West African country’s problems. According to The PUNCH, Nigerian students remitted about US$380 million for foreign education between January and May of this year. Domestic university academic unions have been on strike for months owing to unjust wages.

Frustrated with dwindling local opportunities, students are using any opportunity to pursue better studies and employment opportunities outside. The recent currency meltdown, on the other hand, will not make matters any easier.

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