Let me confess that the label of being a vintage Onitsha-based trader does not in any way confer on me the status of an economic expert. With my vast trading knowledge and my involvement in the real sector,

I am of the strong opinion that the recent decision of the Monetary Policy Committee to increase the Monetary Policy Rate, MPR, to 22.5% and the Cash Reserve Ratio, CRR, to 45% will further worsen the economic situation of most Nigerian households as it is bound to cause more job losses in the productive sector, especially manufacturing and other sectors that rely on bank loans and credit facilities for their funding needs.

Tightening liquidity in the financial system does not improve productivity, ie food production, which is the major cause of inflation in Nigeria. Moreover, only about 12% of N3.6 trillion of the total money in circulation is in the banking system which means that 88%, about N3.2 trillion is outside the banking system.

So, this measure would rather be counterproductive as it would not address the intended purpose of managing the money supply. These new measures will worsen the fragile economy as the supply of funds would dry up for the real sector, and

the new MPR rate hike will push the interest rate on loans to above 30%, which would be very difficult for the real sector operators especially manufacturers and SMEs to repay; resulting, obviously, in increased bad loans, and worsening the nation's economic situation.

The most critical way to manage our high rate of inflation and decline in production is for the government to address the issue of insecurity in the country, which will allow for increased food, and crude oil production, and an overall increase in production,

which will make products, especially food, cheaper. This way we would increase our productivity as well as restore the confidence of FDIs and FPIs to come back to the country.

I must caution that what the Nigerian economy needs now is hard headed practical originality and results. Tinkering with classical economic theories can only deepen our crisis. -PO

Peter Obi

The clown called Cardoso and his master does not have anything upstairs.



God will continually bless you your Excellency.

Omo,

This social media influencer again.

Na statistics we go chop?

If to say this man Neva govern small state before, one would have thought he is a different politician.

Keep the advice you got from a mad man to yourself

Don't forget that Obi is an economist

can someone explain to me why exchange rate is now cheaper on black market then Official rate

Lol, Obi will always be a boy but I think he's right about this, because increasing the monetary policy rate and cash reserve ratio can cause job losses in sectors that depend on bank loans and credit. Just sticking to traditional economic theories will not be enough to handle Nigeria's current complicated economic problems. All I want is progress for Nigeria --Kudos Obi

IgbosCriminals:
Omo,

This social media influencer again.

Na statistics we go chop?

If no be say this man don govern small state before, one would think he is a different politician.

Keep the advice you got from a mad man to yourself

You don't have to sound like an irresponsible fellow all the time man.

APC do dey see from far

The man has just offloaded over 500 members of staff in a very inhumane cruel manner in the midst of the toughest economic hardship ever witnessed in the country

The greatest mistake Ronuists made is ti vote Babablue

This is where it landed us

I have to side with PO on this!!! I have often wondered why Tinubu is not taking any original steps?!! why keep recycling old policies that older administrations either tried and didnt work or announced and never tried? what excatly is the problem?

Why not come out be bold and tackle head on those sabotaging the economy either through terrorism like bokoharam and iswap aka bandits or the currency sabotuers? wht is he afraid of? Why is he hesistant to do the needful? what do they have on him that is making him sit and watch the economy erode to this extent? at this rate tinubu may not do 4 years complete even

Sounds logical... We wait and see what the new policies bring.

Something has to give.

CBN is now a commercial bank giving private loans to individuals - whatever is a norm all over the world, Nigeria finds an easy way to bastardize it - very soon, private individuals can print their own naira at home - afterall, a certain forger in Aso Rock printed his own certificate

It will reduce productivity and cause inflation. But for those who want to be lazy and make some interest on money, it could be fun.

But inflation will wipe out the profits from treasury bills etc

Must this clown always open his mouth? Can't he just shut up to hide his ignorance?

Social media president

The president should drop pride and useless sophistication and propaganda, and listen to the nonsense Obi /Atiku is making ..

... for the sake of Nigeria... he might get it right .

Those his praise singers all all useless and foolish..


Tinubu taking responsibility of all happening in Nigeria today... amidst praises and defense from useless tribal idiots .blaming the past administration.... gained my respect and many Nigerians

Original President

Not the one that entered through the window.

sadiest people from one region are wailing already, Obi is their nightmare

Obi is what he says he is

Giving u the intoto of his analysis, no be the patch patch Cbn CAPRISON and the cert forger BAT and the ORIGIRIGI night school Prof at 👁‍🗨 neck

This guy should shut up. He doesn't know jack about monetary policy. CBN needs to control the inflation by raising the bank rate. That's how it's done all over the world. America did it more than 8 times in 2022/ 2023.

Your wish abi?

CBN is doing what its expected to do to reduce inflation...They must reduce the money in circulation which is a step in the right direction.
The FG on the other hand is working to improve security to increase production which you stated...What else do you want them to do Mr. Obi?

Lol. A genius has spoken.

A genius that takes advice from mad people. He should give us evidence of his own economic policies that transformed Onitsha to Shangri La

maziemeka2024:
It will reduce productivity and cause inflation. But for those who want to be lazy and make some interest on money, it could be fun.

But inflation will wipe out the profits from treasury bills etc

Another illiterate Obi supporter.

Can we digest the content of Obi's criticism and submissions and leave his political differences? Nigeria needs all working suggestions.

The criticism provided by Peter Obi raises valid concerns about the potential negative impacts of the government's decision to increase interest rates in Nigeria. While the points made by Peter Obi about the possible consequences of job losses, credit availability for the real sector, and the overall economy are worth considering, there are a few aspects that can be further explored or countered:

1. **Transmission Mechanism of Monetary Policy**:
- Peter Obi focuses on the potential negative impacts of tightening monetary policy on the real sector. However, it's essential to acknowledge that the Central Bank of Nigeria (CBN) adjusts interest rates to control inflation, stabilize the currency, and foster economic growth. By raising interest rates, the CBN aims to reduce inflationary pressures and maintain price stability. While higher rates may make borrowing more expensive, they can also help in curbing inflation and attracting foreign investments, which are crucial for long-term economic stability.

2. **Inflation Control and Economic Stability**:
- Inflation in Nigeria has been a persistent challenge, and by increasing interest rates, the CBN is signalling its commitment to tackling this issue. High inflation erodes purchasing power, distorts resource allocation, and reduces economic efficiency. By implementing appropriate monetary policy measures, the CBN aims to create a stable economic environment conducive to sustainable growth.

3. **Addressing Root Causes of Inflation**:
- While Peter Obi points out that addressing insecurity and boosting production is vital for reducing inflation and enhancing economic growth, it's crucial to recognize that multiple factors contribute to inflation. Insecurity is undoubtedly a significant concern, but monetary policy, including interest rate adjustments, is a tool that can complement broader efforts to address structural issues in the economy.

4. **Balancing Short-Term Pain with Long-Term Gain**:
- While a hike in interest rates may have short-term adverse effects on businesses and borrowers, it is essential to consider the long-term benefits of price stability and sustainable economic growth. A well-implemented monetary policy can help create an environment that fosters investment, enhances productivity, and attracts both domestic and foreign capital.

In conclusion, while the critique by Peter Obi raises valid concerns about the potential impacts of the interest rate hike by CBN, it is crucial to view monetary policy decisions within the broader context of economic stability and long-term growth. Instead of dismissing traditional economic theories outright, a nuanced approach that considers both short-term challenges and long-term benefits can lead to more effective policy recommendations and outcomes.

Rostikol:
Obi go and find a JOB.

This man no get work?

Everyday he’s on social media yarning dust.

he is richer than your ancestors go and verify

nlfpmod:


Peter Obi

Constructive criticism like this Is highly welcome. Nice one Mr Peter Obi