The International Monetary Fund (IMF) says for the nation’s economy to grow at the desired rate, the Central Bank of Nigeria (CBN) must begin to roll out policies in the coming year that would reduce inflation rate and enhance borrowing from the domestic market at friendly rates.
The nation’s inflation rate, according to the National Bureau of Statistics (NBS), stood at 15.91% at the end of October, while Monetary Policy Rate (MPR) or benchmark interest rate has remained at 14% for years, a rate that makes it convenient for the government to borrow, shutting out the private and productive sector of the economy and hindering their ability to create jobs for the mass of people.
Analysts have since agreed also that with Nigeria’s population growing at about 3%, there is need for the economy to grow at 6% for citizens to feel the impact of the current improvements in GDP which currently stands at 1.5% at the end of Q3, 2017.
A statement on Wednesday said a team of senior IMF officials, led by Miriam Tamene, Senior Financial Sector Expert, Debt and Capital Market Instruments Division, Monetary and Capital Markets Department, spoke during its visit Monday to the Abuja head office of the Securities & Exchange Commission (SEC).
Notwithstanding these drawbacks, Tamen noted that Nigeria remains a choice destination for discern investors, adding at its last Annual IMF Meetings in October, the Fund was pleasantly surprised to receive numerous indications of interest by those eager to invest in Nigeria.
Many of such investors, she lamented, stated still nurse fears over the possibility of retrieving their funds whenever they decide to exit.
“A lot of people thought that Nigeria is still investors destination, the main concerns most of them had was the fear that they might not be able to take out their money anytime they want to, hence they are being very watchful.
“Investors are interested in Nigeria, but with difficulties they had in getting their money out recently, that confidence is not there yet. It has improved though, but they are still watching. It is still so much fragile and not what they can take for granted just ye” she added.
Responding, Acting Director General of SEC, Dr. Abdul Zubair, assured his guests that the outlook of the nation’s economy is good, especially against the backdrop of several initiatives already rolled out by the commission to enhance growth in the capital market and increase investors’ confidence.
The commission, he continued, would in the long term roll out more initiatives to ensure that the Nigerian capital market remains one of the best performing in the world.
The team, the commission explained, was in Nigeria for updates on developments covering all the financial and other key sectors of the economy, after which a report would be presented to the IMF Board in February 2018.