June 23, 2025/CSL Research

Morgan Stanley Capital International (MSCI) has announced that it needs more time to assess Nigeria’s recent foreign exchange reforms before deciding whether to reinstate the country in its MSCI Frontier Markets Index. Recall that Nigeria was removed from the index in February due to persistent issues with foreign exchange illiquidity and difficulties faced by foreign investors in repatriating their capital.

Over the past 24 months, the Nigerian government, in collaboration with the Central Bank of Nigeria (CBN), has implemented a series of market-oriented reforms aimed at improving transparency and efficiency in the foreign exchange (FX) market. Key measures include the unification of exchange rates, the clearance of the backlog of unmet foreign currency demand, and the introduction of the Electronic FX Matching System (EFEMS), which has enhanced price discovery and reduced information asymmetry.

While MSCI acknowledged these reforms as positive steps, it noted lingering concerns, particularly regarding operational constraints within the onshore FX market and the limited transparency of regulatory and market information accessible to foreign portfolio investors

Click here to download full report: ​​CSL Nigeria Daily – 23 June 2025 – Economy.pdf​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​

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