The Central Bank of Nigeria (CBN) has been requested by the Manufacturers Association of Nigeria (MAN) to waive certain of its currency policy’s requirements for the nation’s manufacturers.
This was disclosed in Ilorin on Tuesday during the Manufacturers Association of Nigeria (MAN) in Kwara and Kogi’s 10th Annual General Meeting (AGM) by Chief Bioku Rahman, the organization’s outgoing Chairman.
Additionally, he urged the Bank of Industry (BOI) to swiftly authorize and carry out additional rate cuts for industry loans.
Additionally, he noted that the central bank ought to ask the CBN to lower interest rates by at least 1%.
“We are asking the CBN to waive many of its foreign exchange policies’ conditions to local manufacturers,” he stated.
“In a similar vein, CBN can encourage the federal government to harmonize taxes and levies at the federal, state, and local government levels while expanding the window of foreign exchange to local industries.”
“Therefore, we kindly request that the Federal Government immediately order the Central Bank of Nigeria (CBN) to significantly lower interest rates on loans for industrial purposes.”
“Commercial banks should be instructed by the CBN to lower interest rates on industrial loans. The interest rates on business loans and other loans made available as COVID-19 palliatives ought to be further lowered to 1%.”
The Manufacturers Association of Nigeria (MAN) President, Chief Francis Meshioye, characterized the state government’s relationship with MAN as amicable during his speech.
Additionally, he pushed the state government to improve the industrial estates’ surrounding infrastructure.
What to note
Manufacturers are worried because the depreciation of the naira over the past year has impacted every facet of their business operations.
The price of imported raw materials has skyrocketed recently, driving up operational costs for manufacturers as a whole.
Manufacturers all around the nation have experienced a sharp rise in their financing expenses over time. The Apex Bank raised interest rates by 800 basis points to 26.75% from February 2024. The CBN has been gradually raising interest rates since May 2022 to control inflation and stabilize the foreign currency market.
According to a previous TNC report, exchange rate depreciation and rising financing costs caused consumer products companies’ finance costs to soar by nearly 1000% in the first half of 2024.
Governor Cardoso’s statement that interest rates will decrease as inflation starts to decline, however, has alarmed the Apex Bank.
