While commending the introduction of the Global Standing Instruction (GSI) initiative, aimed at de-risking credit in the industry by committing bank customers to repay their loans to banks, they called for more initiatives.CBN Governor, Godwin Emefiele, while presenting the communiqué of the MPC meeting, last week, noted the increased supply of micro credit to key Micro Small and Medium Enterprises (MSMEs) and efforts of the Nigeria Incentive-Based Risk Sharing System for Agricultural Lending (NIRSAL) Microfinance Bank to extend the reach of its credit facilities across Nigeria.
He however, admitted that the growth in credit to the private sector remains significantly low, relative to the absorptive capacity of the economy.Also underscoring the linkage between high unemployment and heightened insecurity, he emphasised the critical need for urgent steps to be taken towards creating more jobs and wealth creation in the country.He called on government at all levels to ratchet up public works programmes aimed at easing the threat of rising unemployment in the country.
“This would be achieved through efficiency in public spending. The MPC also noted the Government’s current drive to increase Value Added Tax (VAT), adding that this will improve fiscal revenue to support expenditure and reduce the budget deficit, as well as borrowing, when implemented, though too little to close the financing gaps.
“Consequently, government, as a matter of urgency, must adopt a ‘BIG BANG’ approach towards building fiscal buffers, by purposefully freeing-up redundant public assets through an efficient, effective and transparent privatisation process.“This would raise significant revenue for government and resuscitate the redundant assets to generate employment and contribute effectively to national economic growth.
“The unstable oil prices and its implications on accretion to external reserves call for the government to build fiscal buffers. Consequently, the National Assembly must exercise restraint from increasing the oil price budget benchmark to avoid budgetary overruns at the implementation stage of the budget.