By Hosea Parah, Abuja
In a recent briefing by the Central Bank of Nigeria (CBN), Honourable Mohammed Bello El-Rufai, Chairman of the House Committee on Banking Regulations, has highlighted the urgent economic challenges Nigeria faces and the necessity for decisive policy action.
El-Rufai recognized the CBN’s efforts over the past year to stabilize the economy, which included initiatives to enhance market transparency and financial stability. However, he noted that these actions have not yet yielded significant benefits for the average Nigerian.
With inflation currently at 27%, El-Rufai expressed concern that the recent increase in the Monetary Policy Rate (MPR) to 27.25% has exacerbated financial hardships. He underscored the difficulties individuals and businesses encounter in accessing credit due to high borrowing costs, which stifles economic growth.
While commending the CBN for unifying the foreign exchange market and improving liquidity, El-Rufai criticized the naira’s decline to around N1,590 against the US dollar, describing it as “devastating” for an import-reliant economy. He stated, “Nigerians are yet to see any real improvement in their daily lives.”
The briefing also addressed troubling unemployment trends, with a 5.3% rise reported in the first quarter of 2024. El-Rufai noted that many businesses are downsizing due to the harsh economic environment, volatile exchange rates, and increasing operational costs. He raised concerns about Nigeria’s escalating debt, particularly following a recent $6.45 billion loan from the World Bank, which has pushed the debt profile beyond N129 trillion and perpetuated a “vicious cycle of borrowing and inflation.”
To illustrate the rising cost of living, El-Rufai mentioned that the price of a loaf of bread has surged to N1,800, up from N500 last year, while a 50 kg bag of rice now exceeds N100,000. His probing questions regarding future price trends left attendees questioning whether relief is on the horizon.
The session also touched on four Economic Stabilization Bills recently submitted to the National Assembly by President Bola Ahmed Tinubu. El-Rufai called for clarity on how these proposed measures could provide immediate assistance to struggling Nigerians.
The briefing underscored the need for collaboration among stakeholders to devise sustainable solutions to Nigeria’s economic challenges. As the nation confronts these issues, the focus remains on the CBN and its response to the critical concerns raised by El-Rufai. The path to a brighter economic future relies on effective policy changes aimed at alleviating the burdens faced by many Nigerians.vv