ARCHIVES
VOL. 8, ISSUE 3 (2026)
The political economy of the Nigeria–China bilateral currency swap agreement: Asymmetric gains and in who’s best interest?
Authors
Abdullahi Ahmed Mohammed
Abstract
This paper examines the political economy of the 2018 [4]
Bilateral Currency Swap Agreement (BCSA) between the Central Bank of Nigeria
(CBN) and the People's Bank of China (PBoC), valued at RMB 15 billion (NGN 720
billion / USD 2.5 billion) and subsequently renewed in 2021 and late 2024.
Positioned by policymakers as a strategic monetary tool to mitigate US dollar
shortage pressures, decrease transaction costs, and stabilize foreign exchange
reserves, the arrangement reflects deeper structural shifts in global monetary
governance and South-South economic integration. Utilizing a political economy
framework combining structural realism, dependency theory, and international
monetary relations, this study evaluates the domestic driving forces,
institutional mechanisms, and long-term distributional consequences of the
agreement. We argue that while the swap deal successfully offered temporary FX
liquidity relief to Nigerian importers and advanced Beijing’s strategic
campaign for Renminbi (RMB) internationalization, it ultimately exacerbated
Nigeria’s trade asymmetry with China. Rather than catalyzing structural
transformation or export diversification, the swap facility reinforced
Nigeria's status as a consumer market for Chinese manufactured goods,
highlighting the limits of monetary mechanisms in overcoming underlying
real-sector productivity deficits.
Download
Pages:22-28
How to cite this article:
Abdullahi Ahmed Mohammed "The political economy of the Nigeria–China bilateral currency swap agreement: Asymmetric gains and in who’s best interest?". International Journal of Management and Economics, Vol 8, Issue 3, 2026, Pages 22-28
Download Author Certificate
Please enter the email address corresponding to this article submission to download your certificate.