Next Few Months Will be Difficult for Nigerians — Obaseki Warns Ahead of CBN’s Interest Rate Hike

Edo State Governor, Mr. Godwin Obaseki has voiced strong opposition to the recent decision by the Central Bank of Nigeria (CBN) to raise the interest rate to 22.75 percent, deeming it ‘detrimental’ to the nation’s economy.

Speaking at the annual Edo Zone Bankers’ Committee Dinner in Benin, Obaseki expressed concerns about the potential negative impact of the CBN’s decision on businesses and the overall economy.

Attributing the anticipated challenging times ahead to what he considered unfavorable economic policies from both the federal government and the CBN, Obaseki stated, “The next few months will be difficult because the policies rolled out by CBN will unfortunately not support growth in our economy. The interest rate is already high and jacking it up will not allow small businesses access to credit to make them grow.”

The CBN’s Monetary Policy Committee (MPC) recently announced a significant increase in the Monetary Policy Rate (MPR) by four hundred basis points, from 18.75 percent to 22.75 percent. Obaseki emphasized that these policies would hinder economic growth, particularly by limiting access to credit for small businesses.

READ ALSO: CBN Policies Won’t Drive Economic Growth — Obaseki

Advocating for a shift towards policies prioritizing increased production and reduced dependence on imports, Obaseki stressed the importance of focusing on productive activities beyond exchange rates. He expressed concerns over the potential negative impact of increasing cash reserves on the economy and urged a focus on fiscal measures to foster economic growth.

Furthermore, Obaseki called on commercial banks to innovate and introduce products and services aimed at alleviating the economic challenges faced by the majority of citizens across the country.