CBN Focuses on Transparency and Loan Recovery Amid Economic Growth and Inflationary Concerns
Nigeria’s Central Bank Governor, Yemi Cardoso, addressed the media following a Monetary Policy Committee (MPC) meeting, shedding light on the nation’s foreign exchange reserves, which have surged to an impressive $34 billion.
During the press briefing, Governor Cardoso highlighted the factors contributing to the substantial increase in the foreign exchange reserves. He pointed out that the surge, witnessed in February, was fueled by a combination of elevated crude oil prices, an upswing in oil production, and strategic reforms implemented by the Central Bank of Nigeria (CBN).
“Gross external reserves stood at $34.51 billion on February 20th, 2024, compared with $32.23 billion at the end of January 2024,” announced Governor Cardoso, underlining the tangible results of the comprehensive measures taken in the foreign exchange market.
Cardoso also emphasized that the improvement was a product of multifaceted strategies, with reforms in the foreign exchange market and a notable increase in oil production playing pivotal roles. The governor’s disclosure signifies not only a positive economic development but also reflects the resilience of Nigeria in navigating economic challenges.
“I and my team, are not responsible for the woes that we have today. we are part of the solution. We are determined to ensure that we work hard to get out of the mess that Nigeria is in.
” We assumed responsibility in a time of crisis of confidence. And you may all want to go to bed and wish that crisis of confidence was not there. But it was, and we can’t turn back the clock. ”
In his statement, Governor Cardoso also addressed the importance of clarity in financial interventions, cautioning against ambiguity that could lead to distortion. He stated, “Lack of clarity can lead to distortion, and there is no room for failed interventions.” This underscores the governor’s commitment to ensuring transparency and effectiveness in the implementation of financial policies.
The Nigerian Apex Bank’s Governor also expressed the determination of he and his entire team to recover all intervention loans in excess of N10 trillion given to various sectors of the economy. He reiterated this stance during the MPC meeting, emphasizing the central bank’s intention to withdraw from direct development financing.
Governor Cardoso noted the committee’s concern about persistent inflationary and exchange rate pressures. While acknowledging the trade-off between output growth and taming inflation, the committee emphasized its commitment to reversing the rising inflation trend.
Recent data from the National Bureau of Statistics revealed a new record high of 29.90 percent in headline inflation in January, driven by factors such as exchange rate pass-through, rising energy costs, high fiscal deficits, and security challenges in major food-producing areas.
Governor Cardoso acknowledged that CBN interventions had contributed to heightened inflationary pressures but assured that the central bank would remain vigilant in managing these challenges as part of its commitment to fostering economic stability and growth.
As Nigeria continues to focus on economic stability and growth, the news of increased forex reserves serves as a significant boost of confidence for investors and stakeholders. Economy watchers say the proactive stance of the CBN, coupled with strategic reforms, showcases its commitment to bolstering the nation’s economic standing and navigating global market trends successfully.
