BIS Shareholding Could Add $20 Billion to Nigeria’s Economy in 10 Years — Hamzat Urges CBN to Act

BIS Shareholding Could Add $20 Billion to Nigeria’s Economy in 10 Years — Hamzat Urges CBN to Act

PeacePro boss Abdulrazaq Hamzat has urged the CBN to assess Nigeria’s potential BIS shareholding, arguing it could create up to $20 billion in economic value over 10 years.

Nigeria Could Unlock Billions Through BIS Shareholding, Hamzat Says

Nigeria could potentially generate as much as $20 billion in cumulative economic value over the next 10 years if it secures shareholding membership in the Bank for International Settlements (BIS), according to Abdulrazaq Hamzat, Executive Director of the Foundation for Peace Professionals (PeacePro).

Hamzat is calling on the Central Bank of Nigeria (CBN) to conduct a comprehensive assessment of the possible economic and strategic benefits of Nigeria becoming a BIS shareholder.

Importantly, Hamzat stressed that the proposed $20 billion should not be interpreted as money that the BIS would directly pay to Nigeria.

Instead, the figure represents an estimate of the potential economic value that could arise from improvements in areas such as foreign-exchange management, reserve management, monetary policy, financial-sector resilience and institutional capacity.

What Is the Bank for International Settlements?

The Bank for International Settlements is an international financial institution that serves as a forum for central banks and monetary authorities to cooperate on monetary and financial stability.

According to Hamzat, the BIS has 63 shareholder central banks and monetary authorities whose economies collectively represent a very large share of global economic output.

He believes Nigeria should look beyond the immediate financial cost of acquiring shares and consider the broader institutional advantages of closer participation in the global central-banking network.

Why Nigeria’s Reserve Management Could Benefit

One of the areas Hamzat identified as having significant potential is the management of Nigeria’s foreign reserves.

Nigeria manages substantial external financial assets, meaning even relatively small improvements in asset allocation, liquidity management and risk-adjusted returns could have considerable financial implications.

Hamzat argued that the objective should not be to take unnecessary risks in pursuit of higher returns.

Instead, reserve management should continue to prioritize security, liquidity and appropriate returns.

A more sophisticated approach to managing reserves could potentially reduce losses, improve efficiency and strengthen Nigeria’s financial position during periods of global economic uncertainty.

Foreign Exchange Management Also a Major Factor

Nigeria’s economy remains exposed to movements in international oil prices, global interest rates, capital flows and the strength of the U.S. dollar.

These factors can have direct or indirect effects on the naira, inflation, foreign reserves and the wider economy.

Hamzat believes stronger international cooperation and greater institutional expertise could help Nigeria prepare more effectively for external financial shocks.

He argued that Nigeria needs institutions capable of identifying international risks early and developing appropriate responses before those risks become major domestic economic problems.

Financial Stability Could Create Long-Term Economic Value

Another potential benefit highlighted by Hamzat is financial-sector resilience.

The BIS plays an important role in international cooperation on banking supervision and financial stability, including through institutions such as the Basel Committee on Banking Supervision.

For Nigeria, stronger financial-sector monitoring could help identify vulnerabilities before they develop into major banking or currency crises.

A financial crisis can affect far more than banks. It can spread through businesses, households, employment, investment, government revenues and economic growth.

Preventing or reducing the impact of such crises could therefore generate substantial economic value even when there is no direct government payment or dividend involved.

Better Monetary Policy Could Strengthen the Nigerian Economy

Hamzat also linked BIS engagement to the quality of monetary-policy decision-making.

Interest-rate decisions and other monetary policies influence credit availability, investment, production, inflation, employment and exchange rates.

Greater exposure to international central-bank research, cooperation and policy discussions could potentially strengthen Nigeria's capacity to respond to changing economic conditions.

The BIS is also involved in discussions surrounding emerging areas of financial innovation, including digital finance and the future of cross-border payments.

Nigeria and the Future of Cross-Border Payments

The global financial system is undergoing significant technological changes.

Tokenisation, digital currencies, instant payment systems and new forms of cross-border settlement are becoming increasingly important to policymakers and financial institutions.

Hamzat pointed to the BIS's work in this area, including Project Agorá, which explores how tokenised central-bank money and commercial-bank deposits could potentially be used in wholesale cross-border transactions.

For Nigeria, participation in international discussions on these developments could provide an opportunity to better understand emerging financial technologies and their potential implications for the country's financial system.

Hamzat Says $20 Billion Estimate Needs Independent Verification

Despite promoting the proposal, Hamzat acknowledged that the $20 billion projection should not automatically be treated as an established economic forecast.

He wants the figure to undergo rigorous and independent economic modelling.

According to the proposal, even if an independent assessment produces a figure significantly below $20 billion, the potential strategic advantages could still justify further consideration.

The key question, therefore, should be whether the expected economic and institutional benefits outweigh the cost and risks associated with obtaining BIS shareholding.

Proposed CBN-Led Assessment Team

Hamzat has proposed the creation of a Nigeria-BIS Strategic Assessment Team under the leadership of the CBN.

The proposed team would include specialists in:

- Monetary economics

- International finance

- Foreign-exchange markets

- Foreign-reserve management

- Banking regulation

- Financial technology

- Economic planning

- Financial stability

The team would be expected to undertake a detailed cost-benefit analysis before the Federal Government makes any major decision.

Such an assessment could examine the potential effects of BIS shareholding on Nigeria's reserves, banking system, monetary policy, foreign-exchange management and international financial influence.

Could Nigeria Gain Greater Influence in Global Finance?

Hamzat believes the proposal has significance beyond Nigeria's domestic economy.

He noted that no West African central bank currently holds a BIS shareholder position, despite the region's large population and economic importance.

African countries with BIS shareholder representation include Algeria, Morocco and South Africa.

Hamzat argues that Nigeria, as one of Africa's largest economies, should examine whether greater participation in international monetary institutions could give the country a stronger voice in discussions shaping the global financial system.

Regional Implications for West Africa

Nigeria's potential involvement could also have wider implications for West Africa.

Hamzat called for engagement with regional institutions, including BCEAO, WAMA, WAMI and WAIFEM, to examine whether Nigerian participation could contribute to stronger regional representation in international monetary and financial discussions.

Such cooperation could potentially help strengthen regional approaches to financial stability, cross-border payments, monetary coordination and economic resilience.

A Strategic Decision, Not Just a Dividend Question

Hamzat's central argument is that Nigeria should not assess BIS shareholding solely by asking how much dividend the investment might produce.

The more important question, he argues, is whether membership could improve the country's financial institutions and decision-making capabilities.

Better reserve management, stronger risk assessment, improved financial regulation and greater international cooperation could potentially create economic benefits that are much larger than direct investment returns.

What Happens Next?

The proposal ultimately requires a formal assessment by Nigeria's monetary and economic authorities.

Before any decision is taken, policymakers would need to examine the eligibility requirements, financial cost, governance implications, expected benefits and potential risks associated with BIS shareholding.

An independent cost-benefit analysis would also be important in determining whether the projected economic gains are realistic.

For now, Hamzat is urging CBN Governor Olayemi Cardoso and other policymakers to open formal discussions and investigate the opportunity rather than dismissing it without detailed analysis.

The proposal for Nigeria to explore BIS shareholding has opened a broader conversation about the country's role in global monetary governance.

The projected $20 billion economic value over 10 years remains a proposition that requires independent verification rather than a guaranteed financial return.

However, the underlying issues—reserve management, foreign-exchange stability, banking-sector resilience, monetary-policy capacity and Nigeria's international financial influence—are important areas for policymakers to examine.

If a comprehensive assessment finds that the strategic and economic benefits outweigh the costs, BIS shareholding could become part of a broader effort to strengthen Nigeria's financial institutions and increase its influence in the international monetary system.

FAQ...

What is BIS?

The Bank for International Settlements is an international institution that facilitates cooperation among central banks and monetary authorities on financial and monetary stability.

Will the BIS give Nigeria $20 billion?

No. The $20 billion figure cited by Hamzat is an estimate of potential cumulative economic value, not a direct payment from the BIS to Nigeria.

Why does Hamzat want Nigeria to consider BIS shareholding?

He believes closer participation could potentially improve reserve management, financial stability, monetary-policy capacity, foreign-exchange management and Nigeria's international institutional influence.

Is the $20 billion projection confirmed?

No. Hamzat himself has called for independent economic modelling to test the projection.

What should the CBN do next?

The proposal calls for the CBN to conduct a comprehensive cost-benefit assessment involving experts in monetary economics, international finance, reserve management, banking regulation and related fields.

Could BIS membership benefit West Africa?

Potentially. Hamzat argues that greater Nigerian representation could contribute to stronger West African participation in global monetary and financial discussions.

Nigeria BIS shareholding

Secondary Keywords: Bank for International Settlements, CBN, Abdulrazaq Hamzat, Nigeria economy, reserve management, financial stability, monetary policy