The Central Bank of Nigeria (CBN) yesterday reiterated its commitment to stabilising the economy as the apex bank highlighted the success of the ongoing reforms.
CBN Governor, Olayemi Cardoso, at a symposium titled: “Promoting stability in an era of economic reforms: The journey so far”, yesterday in Abuja, reviewed the apex bank’s progress and outlined the achievements of his administration, marking the one-year anniversary of the current management team.
Reflecting on the journey, Cardoso restated CBN’s commitment to stabilising the economy, taming inflation and regaining investor confidence.
He noted that as part of the plans to revitalise the economy, the CBN has set a target to raise monthly foreign remittances to $1 billion.
He stated that, despite significant challenges, the bank had made substantial strides, notably stabilising foreign reserves, which recently surpassed the $40 billion mark, the highest level in nearly three years.
Cardoso said: “The past year was among the most challenging periods in the bank’s history. Yet, it has also been one of transformation, where we tackled a credibility deficit head-on.”
He acknowledged that while inflation remains high, it is trending downward, a positive indicator that reforms are effectively stabilising the economy.
The governor gave a detailed overview of the banks inherited challenges, including a slowdown in the Gross Domestic Product (GDP) growth to 2.31 per cent in early 2023, a steep rise in inflation to 24.1 percent by mid-2023, and a ballooning fiscal deficit.
The CBN’s Ways and Means Advances had reached N22.7 trillion by mid-2023, prompting a policy overhaul to address these issues.
Additionally, capital importation had slowed, with foreign direct investments and portfolio inflows declining over the past decade. Cardoso stated that multiple exchange rate windows had compounded these challenges, causing revenue losses of N6.2 trillion in 2022.
He said the CBN raised the Monetary Policy Rate (MPR) by 850 basis points to 27.25 per cent and increased the Cash Reserve Ratio (CRR) for commercial banks to 50 per cent to tackle inflation and promote economic stability.
Cardoso described these measures as critical to restoring market confidence and addressing inflationary pressures.
Central to these efforts is the CBN’s 2024-2028 Corporate Strategy, which emphasizes Integrity, Meritocracy, Professionalism, Accountability, Courage, and Tenacity (IMPACT) as its guiding values.
Part of the strategy includes the elimination of quasi-fiscal interventions in favour of orthodox monetary policies and simplified foreign exchange (FX) windows.
The CBN has also implemented new guidelines for Bureau de Change (BDC) operations, aiming to reduce disruptions in the FX market and prevent arbitrage opportunities.
The bank has also embraced a “Digital-First Initiative,” streamlining operations and cutting costs through automation and data-driven policy tools. This initiative includes the launch of the Integrated Data Collection and Sharing Portal (IDSP) and the establishment of an Investor Relations Unit to foster transparency and a data-centric approach to investment.
Lagos State Governor Babajide Sanwo-Olu commended Cardoso and the CBN team for their commitment to stabilising the economy.
He praised their focus on self-assessment and constructive feedback, highlighting the need for collaboration between fiscal and monetary authorities to present a cohesive economic vision.
CBN Deputy Governor on Economic Policy, Mr. Muhammad Sani Abdullahi, emphasized that the symposium was not merely a celebration but an acknowledgment of the journey undertaken by the CBN’s management team.
He announced the unveiling of a compendium documenting the bank’s progress, titled: “Promoting stability in an era of economic reforms: The journey so far.”
This publication, he said, encapsulates the values of resilience, collaboration, and determination driving the institution’s transformative efforts.
Cardoso expressed optimism about the future, calling for unified leadership and a collective commitment to overcoming economic challenges and advancing the nation’s aspirations.
