Uche Usim, Abuja
The Monetary Policy Committee (MPC) of the Central Bank of Nigeria (CBN) rose from its 273rd meeting on Thursday with a decision to slash the Monetary Policy Rate (MPR) from 13.5% to 12.5%, while it retained all other policy parameters.
The committee held the liquidity ratio at 30%, Cash Reserve Ratio (CRR) at to 27.5% and the asymmetric corridor at +200 and -500 basis point around the MPR.
Reading the communique after the meeting, the MPC Chairman and CBN Governor, Mr Godwin Emefiele, called for an aggressive and strategic approach towards the gradual reopening the economy, insisting that both lives and livelihoods needed to be saved from the ruinous effects of the COVID-19 pandemic.
He, however, advised that the reopening must align with the safety protocols rolled out by designated health authorities.
Mr Emefiele noted that Nigeria may escape another recession if concerted efforts are made to boost domestic production and export.
To realise this, the CBN governor disclosed that under the N100 billion healthcare intervention fund, the bank has approved and disbursed N10.15 billion for some projects for the establishment of advanced health centres and the expansion of some pharmaceutical plants to make essential drugs and intravenous fluids.
‘From the N1 trillion intervention targeted at the agric and manufacturing firms, the bank has disbursed N93.2 billion under the real sector support fund to boost local manufacturing and production across critical sectors. It consists of over 44 greenfields and brownfield projects,’ he said.
‘The bank has also approved N10.9 billion to 14,331 beneficiaries.
‘Under the N50 billion Targeted Credit Facility (TCF) for households and SMEs, N4.1 billion has been disbursed to 5,868 successful applicants. The committee reached out to banks to help facilitate the disbursement of those loans to priority sectors of the economy so as to stimulate aggregate demands and create more jobs.
‘This is the most potent time to diversify our economy. We must follow through our policies on diversification and there’s no other better time than now.
‘Over 40 countries have banned the export of goods from their countries.
‘Thank God President Buhari asked us to produce rice. We’re almost self-sufficient In rice.
‘Now rice exporting nations have halted export as local demand has risen by up to 70% because they’re running out of stock. They didn’t farm due to COVID-19. The same thing with those exporting drugs.’
On resumption of forex sales to Bureau De Change (BDCs), the CBN governor said it would soon restart as the apex bank halted it as a strategy to curb the nefarious activities of some traders.
‘If people say they want forex to travel and there is a travel ban, it means some people got naira somewhere and want to buy dollars and keep for themselves,’ he explained.
Mr Emefiele further said there was an urgent need for better tax collection to help to diversify the economic base of the country.
He regretted that the COVID-19 pandemic, which hitherto started as a health challenge in 2019, quickly snowballed into a global economic crisis that has disrupted global supply chains and other economic consequences around the world.