Daud Olatunji
Aliko Dangote, the Chairman and CEO of Dangote Group, has voiced strong criticism against the Central Bank of Nigeria’s (CBN) recent interest rate hike to nearly 30 per cent.
Speaking at the opening session of a three-day summit organized by the Manufacturers Association of Nigeria (MAN) at the Banquet Hall of the State House in Abuja on Tuesday,
Dangote warned that businesses cannot cope with the current rate.
In May, following a two-day meeting, the CBN’s Monetary Policy Committee (MPC) decided to increase the Monetary Policy Rate (MPR) from 24.75 per cent to 26.25 per cent.
Announcing the decision, CBN Governor Yemi Cardoso stated, “The Monetary Policy Committee (MPC) of the Central Bank of Nigeria (CBN) held its 295th meeting on the 20th and 21st of May 2024 to review recent economic and financial developments and assess risks to the outlook.
The committee’s decisions are as follows: 1. Raise the MPR by 150 basis points to 26.25 per cent from 24.75 per cent.”
However, during the summit, Dangote expressed deep concerns over the impact of the high interest rate on the business environment, especially for manufacturers.
“Nobody can create jobs with an interest rate of (about) 30%. No growth will happen,” he asserted.
Dangote emphasized the necessity for the government to create a supportive environment for businesses, particularly manufacturers, to thrive.
He highlighted the detrimental effects of the high interest rate, noting that it stifles growth and development.
“No power, no prosperity. No affordable financing, no growth, no development,” he explained.
He further pointed out that a country heavily dependent on imports is essentially importing poverty.
Dangote stressed that for the government to effectively tackle challenges such as unemployment, poverty, and insecurity, it must empower the manufacturing sector to function optimally.
Echoing Dangote’s sentiments, the President of MAN, Francis Meshioye, also criticised government policies and attitudes, attributing them to the underperformance of the manufacturing sector.
Meshioye revealed that over 70 manufacturers have exited the sector between 2019 and 2022, underscoring the urgent need for supportive measures.
“It is time to take stock and rethink a way to support manufacturing businesses, to achieve the agenda of the current administration,” he urged.
The summit, attended by Vice President Kashim Shettima and other government officials, serves as a critical platform for discussing the challenges and opportunities within Nigeria’s manufacturing sector.
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