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Additional Tough Decisions For Nigeria Inevitable, CBN Chief Cardoso Declares 

He expressed relief that the removal of petrol subsidy ended the ‘bleeding’ of natural resources.

 Governor of the Central Bank of Nigeria (CBN), Mr. Olayemi Cardoso, hinted on further implementation of tough decisions by the government as part of efforts to reposition the economy on the path of growth. 

The CBN Governor, who spoke at the opening of the 29th Nigerian Economic Summit (NES#29), with the theme: “Pathways to Sustainable Economic Transformation and Inclusion”, insisted that ongoing fiscal and monetary policy reforms have had salutary effects on the economy so far. Specifically, he said the removal of fuel subsidy and exchange rate unification have availed the government substantial revenues to meet its obligations.

Cardoso also pointed out that going forward, the CBN would take its objective of price stability “very seriously.”

Nonetheless, Cardoso, expressed relief that the bleeding of national resources had been put to an end following the removal of subsidy. He added that the country was now on the path of rebuilding.

According to him, “If the fiscal is bleeding, it makes life very difficult for us on the monetary side. But to the extent, that has stopped and it’s a big deal.”

He said, “This is something that we tried to do for successive years and we failed and the result of not doing it, you have all seen it, and now suddenly, it has stopped.

“In addition to that, the attempt at unification of the foreign exchange market not by anything perfect, but at least, substantial more revenues have come in, so the combination of these two things in addition to some of the other efforts that are being done on the fiscal side are commendable and in due course, we will see the outcome.”

He said, “There are more difficult decisions to be made, no question about it, but the two difficult decisions have been taken and now it is the question of managing things to get to where we really want to get to.”

The central bank governor also said the apex bank was working towards ensuring that the FX market was free from arbitrage with rule-based policies and where there are no policy flip- flops, but where there is predictability.

He said the CBN would soon introduce a framework that speaks to rules and enhances transparency in the FX market.

Cardoso added, “We do need to have a situation where the rules apply to all, we are going to come out with an elegant document that will tell you exactly what the rules are.”

On his part, the Minister of Budget and Economic Planning, Senator Abubabar Bagudu, said: “We are going to either put more money in the budget, or generate more investment in the eight priority areas of the government so that we can see with certainty that security will improve, agriculture and food security will be enhanced, inclusivity will be achieved by providing access to capital, thereby generating economic growth.

The federal government plans to broaden the official foreign-exchange market as a step towards outlawing the parallel market, Taiwo Oyedele, who is the Chairman of Presidential Committee on Fiscal Policy & Tax Reform said.

According to him, the central bank plans to allow other participants including bureaux de change and financial-technology companies that provide mobile-money services.

Once the official market has been expanded, the parallel market will be turned into “a black market, which is just for illicits and speculators,” Oyedele said.

Deji Elumoye, James Emejo in Abuja and Nume Ekeghe in Lagos

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