Follow Us on Google
Governor Godwin Obaseki of Edo State has raised concerns about the recent decision by the Central Bank of Nigeria (CBN) to raise the Monetary Policy Rate (MPR) by 22.75 percent.
In his opinion, this decision does not effectively address the ongoing economic challenges facing the country. Obaseki believes that focusing on increasing local production to meet the demand for goods and services is a more sustainable solution.
During a speech delivered as a guest speaker at the Annual Dinner of the Edo Zone Bankers Committee in Benin City, Governor Obaseki emphasized the importance of boosting domestic production and reducing dependence on imports. He argued that simply tightening liquidity by increasing cash reserves would not lead to economic growth. Obaseki stressed the need for fiscal and monetary policies to work together harmoniously to address Nigeria’s economic issues effectively.
The recent adjustment by the CBN’s Monetary Policy Committee saw the benchmark interest rate raised by 400 basis points to 22.75%. This decision also involved changes to the asymmetric corridor around the MPR and an increase in the cash reserve ratio. The move was aimed at addressing the country’s high inflation rate, which currently stands at 29.90%.
Governor Obaseki urged for a focus on developing the domestic economy to generate more foreign exchange rather than panicking over fluctuations in foreign exchange rates. He emphasized the importance of creating employment opportunities for the youth as a top priority for the nation.
Obaseki’s remarks underscore the complexities of Nigeria’s economic challenges and the importance of comprehensive strategies that prioritize local production, job creation, and coordinated fiscal and monetary policies to foster sustainable growth.
