Ismail Abdulazeez Mantu, Reporting
Edo State, Nigeria
In a candid address at the annual Edo Zone Bankers’ Committee Dinner in Benin City, Edo State Governor, Mr. Godwin Obaseki, expressed deep concern over the recent decision by the Central Bank of Nigeria (CBN) to increase the benchmark interest rate to 22.75 percent.
Governor Obaseki predicts tougher economic times for the country and condemns what he perceives as detrimental economic policies by the Federal Government.
The Monetary Policy Committee (MPC) of the CBN, in a surprising move last week, raised the Monetary Policy Rate (MPR) by four hundred basis points, escalating it from 18.75 percent to 22.75 percent. Governor Obaseki, in his address, underscored the potential adverse impact of this interest rate hike on businesses and the overall national economy, emphasizing the need to redirect focus towards productive activities.
“The next few months will be difficult because the policies rolled out by CBN will unfortunately not support growth in our economy,” stated Governor Obaseki. “The interest rate is already high, and jacking it up will not allow small businesses access to credit to make them grow.”
Obaseki stressed the importance of addressing the fundamentals, particularly emphasizing the significance of increasing production and reducing dependence on imports. He asserted that economic and monetary policies should not be solely determined by exchange rates, urging a more holistic approach.
“The issue of increasing the cash reserves in a bid to tighten liquidity is going to be detrimental to our economy. We should focus on fiscal issues to enable us to grow our economy, not panic about the interest rate. Creating jobs should be a priority for us as a nation,” Governor Obaseki affirmed.
