Tinubu Speaks On CBN’s Interest Rate And Naira Redesign Policy

Posted by Nwa Diokpa Business News, Latest Headlines Tuesday, May 30th, 2023

(AFRICAN EXAMINER) – President Bola Tinubu has stated that the present 18.5 per cent interest rate of the Central Bank of Nigeria (CBN) is “too high”.
Tinubu made this known on Monday in his inaugural speech as president.

Addressing Nigerians, Tinubu stated that the interest rate needs to be adjusted downwards to enable investment as he described the interest rate as “anti-people” and “anti-business”.

“Monetary policy needs a thorough house cleaning. The Central Bank must work towards a unified exchange rate. This will direct funds away from arbitrage into meaningful investment in the plant, equipment and jobs that power the real economy,” Tinubu said.

“Interest rates need to be reduced to increase investment and consumer purchasing in ways that sustain the economy at a higher level.”

The former Lagos State governor also stated his administration will review the naira redesign policy.
“Whatever merits it had in concept, the currency swap was too harshly applied by the CBN given the number of unbanked Nigerians,” Tinubu said.

“The policy shall be reviewed. In the meantime, my administration will treat both currencies as legal tender.”

Also, he promised that his administration will target a higher gross domestic product (GDP) growth as well as a significant reduction in unemployment.

He said: “We intend to accomplish this by taking the following steps: First, budgetary reform stimulating the economy without engendering inflation will be instituted.

“Second, industrial policy will utilize the full range of fiscal measures to promote domestic manufacturing and lessen import dependency.

“Third, electricity will become more accessible and affordable to businesses and homes alike. Power generation should nearly double and transmission and distribution networks improved. We will encourage states to develop local sources as well.

“We shall ensure that investors and foreign businesses repatriate their hard-earned dividends and profits home.”