CBN to increase Foreign Reserve to $50bn


By Anayo Ezugwu

THE Central Bank of Nigeria, CBN, is determined to ensure continuous increase in the nation’s foreign reserves to $50 billion later this year.

At the 25th seminar for finance correspondents and business editors in Uyo, Akwa Ibom State, Godwin Emefiele, governor, CBN, said foreign reserves improved greatly from $23 billion in October 2016, to $47.3 billion as at April 5.

Emefiele, who was represented by Edward Lametek Adamu, deputy governor, corporate services, CBN, said foreign exchange supply improved since the establishment of the Investors and Exporters, I and E, window, with autonomous inflows of over $20 billion through it from April 2017 to date.

“Exchange rate has appreciated significantly from over N525/US$1 in February 2017 to about N360/US$1 today, tapering premium across various windows and segments of the market. Inflation rate has declined from a peak of 18.7 percent in January 2017 to 14.3 percent currently,” he said.

The CBN has also renewed commitment towards supporting the manufacturing sector through its N500 billion intervention fund set up in conjunction with the Nigeria Export- Import Bank, NEXIM. This is part of the bank’s efforts  to provide the much-needed credit to sectors with potential to create jobs on a mass scale.

The loan facility proposed two years ago was created for local manufacturers and exporters with the aim of diversifying revenue base of the economy and expediting growth and development of the non-oil export sector. According to the bank, the loan facility will have a tenure of up to 10 years, not exceeding December 31, 2027, while the principal and the seven percent annual interest will be repaid quarterly and in accordance with the repayment schedule.

“As the sentiments improve in the macro economy and supported by proactive monetary, trade, industrial and fiscal policies, we expect a continued uptick in GDP growth with a positive spill over to improved unemployment rate,” he said.

Emefiele said GDP recovered after five quarters of continuous contraction recording positive growths of 0.7 and 1.4 percent in second and third quarters of 2017, respectively, and signalling an exit from the recession. “We expect a re-doubling of strong policy coordination, collaboration and cooperation which flourished during the very difficult times. To sustain our recovery, the need is greater now than ever for robust policy coordination between the key aspects of economic policymaking space.”

This, he said, would include fiscal, monetary, exchange, and trade policies, which must be targeted at protecting farmers to boost agricultural outputs, support local companies and enhance manufacturing and industrial capacities, with a view to diversifying the economy away from oil and fossil fuels. Nigeria has recorded persistent increase in unemployment rate to 16.2 percent in the second quarter of 2017, from 8.2 percent at the same period of 2015.

In his welcome address, Okafor Nwokoro, branch controller, CBN, Uyo, said the naira which exchanged for as high as N540 per dollar a year ago, has since stabilised at N360 per dollar in a record time proving wrong the notion that in Nigeria when prices go up they don’t come down.

– Apr. 13, 2018 @ 14:25 GMT |





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