Posted by In spite of the economic difficulties facing the country, Godwin Obaseki, governor of Edo state, has scolded the Central Bank of Nigeria for increasing the Monetary Policy Rate by 22.75%.
The CBN’s move, as pointed out by Obaseki, will exacerbate the country’s already dire economic situation.
Given that Nigeria is self-sufficient in terms of exchange rates, he continued by saying that the rationale for raising the monetary policy rate was flawed.
During a weekend event in Benin City hosted by the Edo Zone of Bankers’ Committee, Obaseki made this statement.
What did he say?
“I get the fiscal and fundamental reasoning behind raising MPR, but it won’t help our economy thrive.
Increasing production—making sure our citizens make the goods and services we consume—and decreasing reliance on imports are the fundamentals that need our attention.
It is not possible to base our monetary and economic policies just on the exchange rate. Therefore, our economy will suffer as a result of this whole issue of expanding cash reserves in an effort to limit liquidity. You can’t plan with one hand, I know, but I can appreciate the difficulty the monetary authorities are facing.
Fiscal and monetary policies are the backbone of any economy; crises ensue when one or the other fails to function as intended, as is the case in Nigeria. Therefore, in order to strengthen our economy despite the difficulties we are facing, we should prioritize fiscal matters.