A university don, Dr Anthony Kifordu, has urged the Central Bank of Nigeria (CBN) to ensure that three per cent interest is charged for loans given to the real sector of the nation’s economy.
Kifordu, who is of the Edo University Iyamho (EUI), told the News Agency of Nigeria (NAN) in a telephone interview on Tuesday that the lowering of the interest rate would fast-track the country’s infrastructure upgrade.
He said: “The real sector cannot be vibrant if it does not borrow at single digit interest rate.
“Three per cent interest rate on loans to the real sector is just ideal for the sector to be vibrant.’’
Kifordu, a business administration expert, also said that double digit interest on loans would not enable any form of business to thrive in Nigeria.
“Everything economically good for Nigeria is tied to adequate, functional and modern infrastructure in place.
“Physical infrastructure improvements that Nigerians hope for, will not be a concrete one if the real sector has to pay double digit interest on their loans.
“The current inflation and interest rate on loan in Nigeria also stand as disincentives to business investment development and infrastructure growth of the country,’’ he said.
Pundits have pegged Nigeria’s inflation rate at 16.10 per cent as at June.
The CBN noted that the benchmark interest rate to all sectors, including the real sector was at a steady 14 per cent as at end of July, 2017.
Kifordu also urged the CBN to take tough measures on the“ unwholesome practices” associated with the naira-dollar exchange to stimulate business productivity.
“The `round tripping’ that cause our naira to diminish in value needs to be tackled because that will provide a succour to local entrepreneurs and small businesses.
“Businesses in Nigeria will not grow in bounds and leap if our naira is not given priority in terms of value and major currency for business,’’ he said.
The don noted that there were growing concerns over the falling of the naira as against the dollar.
“Nigeria’s economy shows sign of sickness by a very weak naira.’’
(Source: NAN)