By Etuka Sunday
The Governor, Central Bank of Nigeria (CBN), Mr. Godwin Emefiele has said that the high level dependence of the country on importation to meet domestic consumption was not sustainable, therefore called on the media to support the current efforts of government tilted towards self-sufficiency and industralisation.
Emefiele who spoke at the 24th Seminar for Finance Correspondents and Business Editors in Awka, Anambra State, said there was need to establish appropriate structures that support robust domestic production while imports are used to supplement shortfalls of inputs or final products.
He said, CBN recently introduced the flexible foreign exchange regime, with FOREX restrictions placed on the importation of 41 items.
This, he said, became inevitable in order to curtail fast depleting foreign reserves, occasioned by the significant demand for imports in Nigeria.
He said: “the Bank has consistently supported the economy with robust supply of foreign exchange to deposit money banks (DMBs) particularly to meet demands for invisibles such as school fees, medical tourism and personal travelling allowance. This has led to stability in the Naira exchange rate against the US Dollar.
“Furthermore, the Anchor Borrowers’ Programme (ABP) was established to boost local production of rice, wheat and other agricultural products.
“It serves to create economic linkage between smallholder farmers and reputable largescale processors, with a view to increasing agricultural output and significantly improving capacity utilization of processors.
“The ABP was initiated as a policy option to create an ecosystem that connects smallholder farmers to big processors, thereby creating increased income for the farer, jobs for the unemployed, and steady input supply for 9 agro-businesses.
“I am happy to note that the scheme has already boosted agricultural production and non-oil exports in the face of unpredictable crude oil prices and its resultant effect on the revenue profile of Nigeria.
“These have also helped to moderate volatility in the foreign exchange rate from anticipated decreases to demand for FOREX from increased domestic production of such hitherto imported commodities.”
According to him, “CBN will continue to explore further avenues to ensure that interest rates are supportive of domestic production needs.
“The Bank will continually fine tune measures to ensure and guarantee a stable exchange rate regime. With on-going recovery in economic performance, I am hugely optimistic that improved outcomes will be recorded in our work towards taming inflation, bringing down interest rates and guaranteeing exchange rate stability.
“We are consistently devising ingenious approaches to solve our peculiar challenges and will continue to learn from the experiences of other countries, particularly developing nations.”
He said: “what is required at this point in our economic history is the understanding and support of the citizens. It is at this juncture that I enjoin you as participants in the fourth realm of the estate to objectively report on the CBN’s efforts towards aligning its monetary policy objectives with broader economic policy, in efforts to generate significant domestic industrial activities that support import-substitution industrialization.”
The apex bank Governor said, “the theme selected for this seminar: “Import Substitution and the Dynamics of Interest and Exchange Rates Management in Nigeria” is indeed topical, given recent collaborative efforts to stimulate real sector activities in Nigeria and bolster economic growth.
“This is quite significant for the Central Bank of Nigeria (CBN) in view of its various interventions, mainly to provide cheap financing for critical sectors and to enhance domestic production.”