From Uche Usim, Abuja
Central Bank of Nigeria (CBN) Governor, Mr Godwin Emefiele, on Wednesday wooed foreign investors in Paris that Nigeria, as a leader in Africa, is ready
for business.
Emefiele spoke on the economy at the France-Nigeria Security and Economic Summit.
He assured them that the apex bank will continue to monitor progress and respond promptly and flexibly to support economic recovery from COVID-19.
He reeled out several indices that suggest that Nigeria was on a progress path as regards economic growth.
On Nigeria’s foreign reserves, Emefiele said it has increased to over $40 billion from about $33.4bn in March 2020 due to
inflows from the IMF, Eurobond proceeds, and complemented by CBN’s astute management of the foreign exchange market.
He added that the Nigerian economy was becoming increasingly conducive for multilateral engagements.
“The exchange rate continued to experience significant pressure in the various windows. Accordingly, the CBN adjusted the official exchange rate from N306/$ to
N405/$. Today, the exchange rate at the I&E is hovering around N412/$1.
“Nigeria’s GDP is projected to grow by 2.86
percent for 2021. The IMF and the World Bank also project real growth rates of 2.6 percent and 2.4 percent. The Nigerian fiscal authorities, such as the Federal Ministry of Finance and National planning, also project a real GDP growth of 3.0 percent. The positive outlook is due to high oil price which exceeds the $70 pb mark, the implementation of the
Economic Sustainability Plan, and a rebound in manufacturing
activities.
“Improved business confidence: Confidence in the Nigerian
business environment is growing due to sustained policy
interventions in the economy. Overall business confidence
index is projected at 37.7 index points in November 2021 and
57.6 index points by mid-2022.
“Headline inflation rate is expected to moderate to 15.35 percent by December 2021 and 14.91 percent by February 2022, respectively. Core inflation is expected to fall to 13.39 percent in December 2021 from 13.74 percent in October 2021. This is due to the favourable impact of the
various CBN and government interventions in the agriculture
and the real sector, the moderation of supply side constraints and the gradual increase in domestic economic activity, which is expected to keep prices low in the near-term.
“Nigeria’s external reserves is
expected to surpass US$42 billion by mid-2022. This is due to
the sustained increase in crude oil price, the impact of
Eurobond Issuance, and the stable exchange rate condition.
“Better conduct of monetary policy: The launch of the e-
Naira will improve the conduct of monetary policy in Nigeria,
reduce transaction costs and increase financial inclusion in
the medium to long term. We expect an increase in the
availability of credit through the CBN intervention programmes
to increase aggregate demand and stimulate growth in key
sectors that face credit constraints”, Emefiele explained.
The CBN Governor told the audience that the Nigeria expects higher revenue due to stronger
revenue administration efforts by the fiscal authorities.
He also said increase in oil revenue was underway with the planned take-off of the Dangote refinery and the implementation of the Petroleum Industry Act (PIA),
which are expected to expand the fiscal space of government
in the medium to long term, will boost growth.
“Also, the improvement crude oil prices are expected to provide stability to Nigeria’s external reserves and exchange rate”, he added.
He also said that the government’s economic diversification planks were up and running as there is drastic reduction in importation of goods that can be produced in the country to create employment opportunities for Nigerians.
Emefiele added that the country now depending on agriculture production and commencing local
production of goods like petroleum and petrochemical
products.
He also revealed that a cocktail of stimulus packages were put together by the apex bank to cushion the pains of the COVID-19.
“The CBN immediately intervened to cushion the short term effects of
COVID-19 on households and businesses. The CBN
intervened by: creating a NGN 100 billion target credit facility for affected households and small and medium enterprises through
the Nirsal Microfinance Bank; creating a NGN100 billion intervention fund in loans to
support pharmaceutical companies and healthcare
practitioners and to expand and strengthen the capacity of
our healthcare institutions; creating a N1 trillion facility in loans to boost local
manufacturing and production across critical sectors; creating a research fund, which is designed to support the development of vaccines in Nigeria.