The Lagos Chamber of Commerce and Industry (LCCI), has said that the recent hike in the interest rates, by the Central Bank of Nigeria (CBN), will further throw the private sector into more profound loan repayment crises.
The Chamber, in its reaction to the recent interest rates hike, on Wednesday, signed by the Director General, Dr. Chinyere Almona, stated that the recent hike might also lead to a reduction in demand since it would weaken the purchasing power of Nigerians, and, in consequence, lead to lower industrial production and eventual loss of jobs.
The Chamber also reiterated its earlier position on the need to implement targeted fiscal and monetary interventions, capable of boosting food production, lowering the cost of doing business, overhauling transport infrastructure, and creating a more enabling environment, among others.
“Specifically, the Chamber had recommended that the CBN apply an import duty exchange rate lower than the official rate at a fixed rate for a determined period.
“This is expected to help businesses plan better and serves as a palliative that benefits a high proportion of the populace. Earlier in the year, we called on the government to implement specially targeted support for strategic industries,” the business advocacy body stated
LCCI also stressed the need to take more decisive action to stabilise prices and support the citizens’ purchasing power, as inflation continues to defy various interventions by monetary and fiscal authorities.
“With several hikes in the past months, we are yet to record a significant impact on stabilizing prices. The twin burden of high inflation and interest rates is overheating the economy and causing increased volatility and uncertainty,” the Chamber noted.
On the ongoing minimum wage debate, the Chamber called on the government to plan for the massive commitment of resources to implement the new wage, at the end of the debate, since the discourse represents the next levels of government recurrent spending that may further fuel inflationary pressures into the second half of the year.
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