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Mr Obi in his statement argued that these increases, which have pushed interest rates on loans above 30 percent, are making it exceedingly difficult for manufacturers and Micro, Small, and Medium Enterprises to borrow and repay loans. It’s essential to acknowledge that news production incurs expenses, and we take pride in never placing our stories behind a prohibitive paywall.According to him, the report also indicated a decline in capacity utilization to 56 percent, an effective interest rate above 30 percent, and an increase in the inventory of unsold finished products to N350 billion. Additionally, the real growth rate has dropped to 2.4 percent.
“We need to reverse course and only initiate policies that can lead to growth and the birth of a new Nigeria,” he said.Since the start of the year, the CBN has increased interest rates by a total of 750 basis points across three consecutive Monetary Policy Committee meetings. During this time, interest rates have risen from 18.75 per cent to 26.25 per cent, with the central bank maintaining that high interest rates are necessary to curb inflation.
“During COVID, we didn’t do anything at all. The only thing we did was food palliative and I’m talking about Africa in general. Right now, at 30 per cent, there is no way anybody can create jobs because we are actually stifling growth. So the interest rate can remain at 30 per cent but no growth will happen unless that interest rate comes down,” he said.