Femi Odewunmi

When the Governor of the Central Bank of Nigeria (CBN), Olayemi Cardoso, took the stage at London Business School earlier this month, the packed auditorium reflected both curiosity and cautious optimism. Supported by J.P. Morgan and Goldman Sachs, the dialogue moderated by Professor Hélène Rey placed Nigeria’s reform agenda on the global stage and signaled a confident new phase in the country’s economic re-engineering.

“We stayed with orthodox monetary policy, and the economy is responding,” Cardoso told the audience. “Stability is not the absence of change; it is the environment that allows productive change to occur.” That message, stability as the cornerstone of growth, now defines the Central Bank’s policy direction. Behind it lies a deliberate reform framework designed to rebuild confidence, attract investment, and deliver the predictability that Nigerian businesses have long demanded.

At the heart of this approach is a determination to restore macroeconomic stability through credibility and discipline. When the new leadership assumed office, inflation was high, multiple exchange rates created distortions, and market confidence had eroded. The Bank responded by re-anchoring monetary policy around transparency and coordination. Decisions are now guided by data, and communication has become a tool of policy. For businesses, that predictability allows pricing and planning; for government, it strengthens budget execution and reduces borrowing costs. As Cardoso put it in London, “Stability is the quiet engine of confidence.”

The most visible of these reforms has been the foreign-exchange market overhaul. The shift to a willing-buyer, willing-seller model ended years of administrative allocation and introduced electronic trade matching for real-time visibility. By eliminating opacity, the Bank has narrowed the gap between official and parallel rates from more than 30 per cent to low single digits and restored liquidity. For importers, exporters, and investors, access to foreign currency is now rule-based rather than relationship-based. “Liquidity attracts liquidity,” the governor said. “When participants see that the market is real and transparent, confidence returns.”

Policy coherence has also been central to the Bank’s approach. Cardoso has insisted that monetary policy cannot succeed in isolation, emphasizing stronger coordination with the Ministry of Finance, the Budget Office, and the Debt Management Office. His Special Adviser on Financial Markets, Mayokun Ajibade, calls this “institutional handshake economics”. The practical effect is fewer conflicting signals and more consistent policy communication. For investors, it means clarity; for Nigerian enterprises, it means fewer shocks to plan around.

The Bank’s ongoing recapitalization programme is another major pillar of the stability agenda. It is designed not as a rescue but as preparation for the next growth cycle. Lenders have been given time and options, raise capital, merge, or reclassify, to strengthen their balance sheets and expand capacity to finance a trillion-dollar economy. Bigger and better-capitalized banks can fund infrastructure, industrial expansion, and housing, creating a financial system robust enough to power real growth. The message is that stability in the banking system is a public good, and resilience is now policy.

Technology is also reshaping how the Central Bank operates. Cardoso disclosed that the institution has begun integrating artificial intelligence into supervision and analytics, following a board retreat on digitalization and AI. Machine learning is already being used to detect anomalies, monitor compliance, and forecast more accurately. For the financial sector, this means faster, data-driven regulation; for consumers, it means greater transparency and efficiency. As Dr. Nkiru Balonwu, a senior advisor to the governor, noted at the LBS event, “Digitalization is not just technology; it is accountability. Data is the new language of trust.”

On digital assets, the Bank has chosen pragmatism over prohibition. Cardoso acknowledged that the crypto market “developed a life of its own”, but stressed that innovation must be guided by transparency and consumer protection. The CBN and the Securities and Exchange Commission (SEC) are crafting a framework to regulate cryptocurrencies and dollar-backed stablecoins within clear risk parameters. The goal is not to stifle innovation but to prevent speculative excess that could threaten financial stability. This balanced stance reassures fintech innovators while protecting the integrity of Nigeria’s financial system.

Underlying all these reforms is an understanding that stability must be actively managed. Cardoso has made communication a cornerstone of that process. “People talk about interest rates and reserves,” he told the London audience, “but communication is the thread that holds monetary policy together. If citizens, investors, and markets don’t understand what you are doing, policy loses power.” His emphasis on openness has begun to change how Nigerians perceive monetary policy, making it less about mystery and more about measurable progress.

For the business community, the message is clear. Stability offers a chance to plan beyond crisis management. Predictable markets allow firms to price exports competitively, attract financing, and manage risk without speculative uncertainty. For banks, the recapitalization window is an opportunity to expand responsibly and innovate in areas like green finance and SME lending. For policymakers, the challenge is to maintain coordination so that fiscal actions complement monetary discipline rather than contradict it.

Nigeria’s stability-first framework is already yielding results. Inflation is easing, the naira is finding equilibrium, and investor sentiment is improving. Yet the governor remains cautious. “Reform fatigue is real,” he said. “Our task now is to keep communicating, keep coordinating, and keep the focus on credibility.”

The implications are far-reaching. A stable currency, disciplined markets, and consistent communication are not abstract policy goals, they are the foundations of sustainable prosperity. For Nigeria’s public and private leaders alike, the next phase of transformation depends on one shared conviction: that growth built on stability endures, while growth without stability cannot.

·         Mr. Odewunmi is the Group CEO of Creative Intelligence Group, a strategic communications and policy advisory firm advising public institutions on policy communications and credibility-building across governance and economic policy

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