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'High interest rate will make cost of borrowing higher for productive sector' - Ex-ANAN president

The Ex-president urged the Federal Government to encourage productivity by creating enabling environment so that the country could have sufficient goods.

Dr-Samuel-Nzekwe, former President, Association of National Accountants of Nigeria (Credit: The Sun Nigeria)

Nzekwe, who is also the former President, Association of National Accountants of Nigeria (ANAN) stated this to the News Agency of Nigeria (NAN) on Wednesday, July 26, 2023 in Ota, Ogun.

He spoke against the backdrop of the outcome of two-day meeting of Monetary Policy Committee (MPC) of Central Bank of Nigeria (CBN). NAN reports that the Acting Governor of the CBN, Mr Folashodun Shonubi, announced after the two-day meeting on Tuesday in Abuja, that the MPR had been raised from 18.5% to 18.75.

Cash Reserve Ratio (CRR) and Liquid Ratio were retained at 32.5% and 30%. The MPR is the baseline interest rate upon which other interest rates are built.

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“Increasing interest rate would make borrowing and cost of money, especially for those in the productive sector, costly,” he said.

“In addition, goods produced under this MPR will become costly and contribute to increase in nation’s inflation rate,” he said.

The ex-ANAN president noted that the MPC was trying to moderate inflation rate but it would not work because Nigeria imports most of the goods consumed and exports less out of the country.

Nzekwe urged the Federal Government to encourage productivity by creating enabling environment so that the country could have sufficient goods. He stressed the need to leverage on area where the country had comparative advantage in order to produce and import less.

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