Nigerian students seeking foreign education will likely spend N310.63bn more to get dollars as the Central Bank of Nigeria allowed for a free float of the national currency against the dollar and other global currencies.
The current rate of 755.6/$ will put the total figure at N763.16bn, which is an increase of N310.53bn or 68.64 per cent.
The apex bank, in an earlier statement, noted that all segments would now be collapsed under the Investors and Exporters Windows.
“All segments are now collapsed into the Investors and Exporters windows. Applications for medicals, school fees, BTA and PTA, and SMEs will continue to be processed through deposit money banks,” the statement partly read.
These changes mean that Nigerians schooling abroad, paying for their school fees via CBN rate FX will now have to pay the floated market rate.
In a separate statement, the CBN said that all visible and invisible transactions (medicals, school fees, BTA/PTA, airline and other remittances) were eligible for the Investors’ and Exporters’ window.
Banks were urged to ensure expeditious processing of all eligible invisible transactions on behalf of their customers using the applicable rate at the I & E window.
Data from the CBN on the sectoral utilization of foreign exchange showed that foreign education gulped about $1.01bn in 2022.
The buying rate for the US dollar was about N448.05/$ as of December 30, 2022, according to the exchange rate data of the CBN.
However, with the unification of multiple rates and the floating of the naira, the CBN pegged the buying rate for the US dollar at 755.6/$ as of Thursday, July 6, 2023.
Applying this December rate to the total amount spent on foreign education showed that it gulped about N452.53bn from foreign students residing in the country.
However, the current rate would put the total figure at N763.16bn, which is an increase of N310.53bn or 68.64 per cent.
It also means that the official naira lost about 40.7 per cent of its value, which further weakened the buying power of foreign students in long-distance education in the country.
A breakdown of the dollar spending on foreign education showed that in January 2022, $60.2m was spent on foreign education, while $69.9m was spent in February 2022.
In March 2022, there was a significant increase as the bank stated that $87.26m was spent, but there was a little reduction in April as a total of $78.62m was recorded by the apex bank.
The figure for May 2022 was put at $82.78m, while in June and July 2022, the apex bank released $84.98m and $61.99m, respectively.
A slight increase was recorded in August and September 2022 when $84.01m and $86.34m were released, respectively.
By the final quarter of the year, forex for educational purposes gulped $96.19m in October, $125.29m in November and $93.12m in December.
The total forex spent on education services in 2022 was 40.36 per cent higher than the $720.05m spent in 2021, which means that more Nigerians have been showing interest in foreign education.
Nigerians have continued to troop out in their numbers in pursuit of foreign academic qualifications.
Recent data released by the Home Office of the United Kingdom revealed that the number of study visas released to Nigerians increased by 222.8 per cent, with 65,929 issued as of June 2022 as against 20,427 during the same period in 2021.
Education in Nigeria, especially in the tertiary educational sector, has been marred by industrial actions by tertiary institution-based unions such as the Academic Staff Union of Universities, the Academic Staff Union of Polytechnics and the Colleges of Education Academic Staff Union.
Also, the cost of getting naira for personal travel and medical tourism is expected to increase due to the unification.
ASUP, ASUU fume
Speaking in separate interviews with our correspondent, the National President of the Academic Staff Union of Polytechnics, Dr Anderson Ezeibe, and the chairperson of the Academic Staff Union of Universities, Federal University of Technology, Minna, Prof. Gbolahan Bolarin, called for a revitalization of the education sector.
According to them, a well-improved education sector back home would force citizens to stay behind and reduce the desire for foreign education.
Bolarin said, “It is very simple, fix Nigeria, and Nigerians would stay back. If Nigeria is fixed, people would tend to stay back and demand for dollar would drop and that might help the naira to gain against the dollar.
“Also, we should stop this idea of ‘dollarizing’ everything. Until then, people would continue to pay more for ‘quality; education which most people believe that it is available overseas because of the state of our public universities.”
He added that the poor state of public universities in the country has made some parents prefer foreign education for their children.
Bolarin said, “Anyway, it is obvious that parents with genuine or otherwise sources of funds are taking their wards to private universities and some overseas because they can’t just stand their wards studying in a typical public university. No one would want their wards to study in a public university where there are no adequate labs, classrooms etc.
“Except if we want to hide behind one finger, then we would pretend as if we are not aware of what is pushing people overseas for studies. Simply, Nigerian Public Universities are in bad shape, and people of means would continue to push their wards overseas until we are serious about our educational system; that is, holistic overhauling of the system (good welfare for staff, better funding, proper monitoring without eroding university autonomy etc) is needed.”
Also, ASUP national president, Ezeibe, stressed the need to fix public education institutions in the country.
He said, “How many Nigerian parents can actually afford to send their children/wards overseas for education in a country pronounced as the poverty capital of the world? The truth is that the vast majority of parents cannot afford it, and as such, their children are left to deal with the rot and decay in the system.
“Of course, the privileged ones can afford to go overseas, but the large majority will still have to be trained in such a deprived environment. They have little or no choice.
“The solution remains with us: Fixing our public education institutions from basic, through secondary and up to tertiary. Government must view education as a social responsibility and devote resources towards actualising quality and functional education for its citizens.”