The national leader of the All Progressives Congress (APC), Bola Tinubu, is of the opinion that if the COVID-19 crisis is to have any positive economic aspect, then it should be that Nigeria used this moment to drive down interest rates.

Chief Tinubu in a lengthy communique on Sunday, advised the Federal Government avail tax reliefs that would aid financial institutions in the country to reduce their interest rates.

In his statement, the elder statesman noted that by doing this, the government will saving the nation from a monumental drag on national economic growth.

According to him, lower rates will increase domestic investment and production, as well as create jobs.

While noting that lower rates may have some negative short-term impact on inflation and the exchange rate, the former governor of Lagos argued that the economic dislocations caused by the coronavirus will serve to mitigate those temporary negative consequences.
Below is the full statement by Asiwaju Bola Ahmed Tinubu.

THE CASE AGAINST HIGH INTEREST RATES IN TIME OF CONTAGION

THE TIME IS NOW – CORRECT THE INTEREST RATE

The economic fallout from the coronavirus may present the best, most pressing case for revising the CBN’s high interest rate policy. The undue rates penalise domestic investment and consumer borrowing. This reduces both aggregate domestic supply and, to a lesser degree, aggregate domestic demand. The chronic gap between domestic supply and demand has been filled by bloated levels of imports and encouraged an overvalued exchange rate that the high interests have helped produce. In normal times, the high interest rates also attract significant foreign financial speculation, the ever-ominous hot money. While in the short-term, the foreign speculation boosts financial inflows. Over time, as compound interest payments become due on these foreign investments, the nation will lose an ever-increasing amount of money to satisfy foreign debt obligations. In the short run, high rates seem to attract foreign capital and spur the economy while giving it discipline against inflation. In the longer-term, all of this is untrue. High rates give us the worst of both worlds. They stifle domestic investment and incomes while pushing up inflation and exposing an ever-increasing share of our financial system to foreign manipulation and dependence. Put another way, if you take a single picture early in the process, the high interest rate policy looks good at that moment in time. However, if you view the entire movie, you will see an ending that is both painful and unnecessary.

The Central Bank of Nigeria has demonstrated its financial agility by establishing a growing number of special financing programs for various industries and sectors of the economy. While these programs look good at first glance, they also expose important contradictions in the CBN’s position. The special schemes are an implicit admission that normal rates stifle investment borrowing and thus suppress the economy. The extraordinary schemes would not be required if the general interest rate was at a proper level. By establishing the special programs, the CBN attempts the impossible. On one hand it defends the general rate as prudent. On the other, it proliferates special exceptions in order to spur investment borrowing that the general rate has heretofore stifled.

This complex CBN rear-guard action does not serve the greater purpose. It merely prolongs the inevitable: We must retreat from high interest rates if we want investment borrowing to attain levels that actually increase private-sector growth and job creation.

This point bears repetition. If the financial sector functioned properly, servicing the needs of the economy in general, there would be no need to constantly resort to specialised sectoral plans (one for this industry, another for that industry and so on) for concessionary lending below regularly available rates of interest. Each such scheme is evidence that the overall financial system is fragmented in a manner that artificially reduces investment and the positive consequences increased investment has on growth, production and employment. The schemes are akin to a homeowner who, confronted with severe structural damage, commissions a fresh coat of paint to obscure the obvious structural flaws. Just as the homeowner should focus on fixing the core problem to prevent the house from crumbling, the Bank should do the one great thing it can do to free the economy from an unpayable burden. It should reduce interest rates.

The modern global economy is built on credit. Prosperous nations have built success based on the sustained ability to use credit to generate high levels of domestic investment as well as allow for significant consumer financing. Unlike two centuries ago, most business investment is not derived from the self-generated funds of the businessman or investor. Investment comes mainly from bank loans. However, the current rate of interest in Nigeria prohibits most normal business investment. Thus, the productive sector stagnates as innovation and creative endeavour are discouraged. Employment and aggregate demand are dragged down. The economy becomes a slave to a negative, impoverishing dynamic.

Read Further:

https://dailynaijamode.com/covid-19-reduce-interest-rates-provide-tax-reliefs-tinubu-tells-banks-and-fg/

Jagaban

Waiting for the economists to appraise this suggestion

What fool would take this man seriously?

[img]https://media./images/fc60d29b491774d6addabd1a2292cc16/tenor.gif[/img]

This man should stop talking and do palliative to one million boys

Presidential material
Jagaban himself
Slayer of Ibo party
May you live long to rule Nigeria

NwaNimo1:
What fool would take this man seriously?

[img]https://media./images/fc60d29b491774d6addabd1a2292cc16/tenor.gif[/img]

iyanmiri engris

audio billionaire I hail oh

can his be true

byteem:


Well.did.you hear.any other language.. the yourbas are like.the proverbial.ostrich.. despite all this just wait come 2023 their god from ikoyi will bring out his bullion van give them 500 naira and one indomie each and they will start clapping for him again.. dumb and cowardly mofos.. they never learn.. at least the average uneducated igbo youth has trade and self pride .. and so does the Aboki.. at least they push carts, sell tomatoes and swallow their pride to do the dirty jobs most others find disgusting just to earn
a living.. the average uneducated yoruba youth is either a criminal or a criminal in training with only few exceptions who seem to be swimming against a massive tide as thier illetrate cult people will not let them rest. Most of their Men lazy around and wait for their women to feed them .. They have no land to farm.cos their fathers sold everything , they have no industries to work cos their politician

s steal seamlessly..and only build empty highrise offices in ikoyi. They have no markets to trade in cos they are too impatient and greedy they will eat their capital and profit and sell their shops to others.. and collect owoile.. the yorubas have an emergency on their hands but like the ostrich they will bury their head in the sand and claim thier house is in order. They will come here and abuse me and claim to know it all ..sad just sad

piggyyeaster:
Presidential material
Jagaban himself
Slayer of Ibo party
May you live long to rule to rule Nigeria

can this be true

byteem:


Well.did.you hear.any other language.. the yourbas are like.the proverbial.ostrich.. despite all this just wait come 2023 their god from ikoyi will bring out his bullion van give them 500 naira and one indomie each and they will start clapping for him again.. dumb and cowardly mofos.. they never learn.. at least the average uneducated igbo youth has trade and self pride .. and so does the Aboki.. at least they push carts, sell tomatoes and swallow their pride to do the dirty jobs most others find disgusting just to earn
a living.. the average uneducated yoruba youth is either a criminal or a criminal in training with only few exceptions who seem to be swimming against a massive tide as thier illetrate cult people will not let them rest. Most of their Men lazy around and wait for their women to feed them .. They have no land to farm.cos their fathers sold everything , they have no industries to work cos their politicians steal seamlessly..and only build empty highrise offices in ikoyi. They have no markets to trade in cos they are too impatient and greedy they will eat their capital and profit and sell their shops to others.. and collect owoile.. the yorubas have an emergency on their hands but like the ostrich they will bury their head in the sand and claim thier house is in order. They will come here and abuse me and claim to know it all ..sad just sad

Tinubu and Atiku are desperately trying to outdo each other as to who is a better presidential material. They anyways have one or two things to say regarding the economy every other week. The debate on how to keep the economy is afloat is necessary and must be encouraged. However, we can read 2023 politics into all of these.

While some people are busy hating and issuing meaningless threats, the real contenders for 2023 are already positioning themselves before the electorates.

Yet Tinubu has not reduced any tarrif on his two toll gates in Lagos

This man has proven to not know a thing about economics ......

U want distressed banks with months of losses and diminishing liquidity to reduce interests rates ? When we already have hyper inflation ?

This is even worst than the printing money idea

dailynaijamode:
The national leader of the All Progressives Congress (APC), Bola Tinubu, is of the opinion that if the COVID-19 crisis is to have any positive economic aspect, then it should be that Nigeria used this moment to drive down interest rates.

Chief Tinubu in a lengthy communique on Sunday, advised the Federal Government avail tax reliefs that would aid financial institutions in the country to reduce their interest rates.

In his statement, the elder statesman noted that by doing this, the government will saving the nation from a monumental drag on national economic growth.

According to him, lower rates will increase domestic investment and production, as well as create jobs.

While noting that lower rates may have some negative short-term impact on inflation and the exchange rate, the former governor of Lagos argued that the economic dislocations caused by the coronavirus will serve to mitigate those temporary negative consequences.
Below is the full statement by Asiwaju Bola Ahmed Tinubu.

THE CASE AGAINST HIGH INTEREST RATES IN TIME OF CONTAGION

THE TIME IS NOW – CORRECT THE INTEREST RATE

The economic fallout from the coronavirus may present the best, most pressing case for revising the CBN’s high interest rate policy. The undue rates penalise domestic investment and consumer borrowing. This reduces both aggregate domestic supply and, to a lesser degree, aggregate domestic demand. The chronic gap between domestic supply and demand has been filled by bloated levels of imports and encouraged an overvalued exchange rate that the high interests have helped produce. In normal times, the high interest rates also attract significant foreign financial speculation, the ever-ominous hot money. While in the short-term, the foreign speculation boosts financial inflows. Over time, as compound interest payments become due on these foreign investments, the nation will lose an ever-increasing amount of money to satisfy foreign debt obligations. In the short run, high rates seem to attract foreign capital and spur the economy while giving it discipline against inflation. In the longer-term, all of this is untrue. High rates give us the worst of both worlds. They stifle domestic investment and incomes while pushing up inflation and exposing an ever-increasing share of our financial system to foreign manipulation and dependence. Put another way, if you take a single picture early in the process, the high interest rate policy looks good at that moment in time. However, if you view the entire movie, you will see an ending that is both painful and unnecessary.

The Central Bank of Nigeria has demonstrated its financial agility by establishing a growing number of special financing programs for various industries and sectors of the economy. While these programs look good at first glance, they also expose important contradictions in the CBN’s position. The special schemes are an implicit admission that normal rates stifle investment borrowing and thus suppress the economy. The extraordinary schemes would not be required if the general interest rate was at a proper level. By establishing the special programs, the CBN attempts the impossible. On one hand it defends the general rate as prudent. On the other, it proliferates special exceptions in order to spur investment borrowing that the general rate has heretofore stifled.

This complex CBN rear-guard action does not serve the greater purpose. It merely prolongs the inevitable: We must retreat from high interest rates if we want investment borrowing to attain levels that actually increase private-sector growth and job creation.

This point bears repetition. If the financial sector functioned properly, servicing the needs of the economy in general, there would be no need to constantly resort to specialised sectoral plans (one for this industry, another for that industry and so on) for concessionary lending below regularly available rates of interest. Each such scheme is evidence that the overall financial system is fragmented in a manner that artificially reduces investment and the positive consequences increased investment has on growth, production and employment. The schemes are akin to a homeowner who, confronted with severe structural damage, commissions a fresh coat of paint to obscure the obvious structural flaws. Just as the homeowner should focus on fixing the core problem to prevent the house from crumbling, the Bank should do the one great thing it can do to free the economy from an unpayable burden. It should reduce interest rates.

The modern global economy is built on credit. Prosperous nations have built success based on the sustained ability to use credit to generate high levels of domestic investment as well as allow for significant consumer financing. Unlike two centuries ago, most business investment is not derived from the self-generated funds of the businessman or investor. Investment comes mainly from bank loans. However, the current rate of interest in Nigeria prohibits most normal business investment. Thus, the productive sector stagnates as innovation and creative endeavour are discouraged. Employment and aggregate demand are dragged down. The economy becomes a slave to a negative, impoverishing dynamic.

Read Further:

https://dailynaijamode.com/covid-19-reduce-interest-rates-provide-tax-reliefs-tinubu-tells-banks-and-fg/

This frog is over straying it's pond

mrvitalis:
This man has proven to not know a thing about economics ......

U want distressed banks with months of losses and diminishing liquidity to reduce interests rates ? When we already have hyper inflation ?

This is even worst than the printing money idea

Some of you criticize just for the sake of criticism. In US, apart from the billions of dollars that Trump is giving to support businesses, he has been on the neck of the Federal reserve bank to crash interest rates to businesses.

Medium and small businesses are worst hit by the pandemic than banks. They are going to need all possible support to get back on their feet. Even before the lockdown, internet was simply too high for MSMEs. After the pandemic, we must crash internet rates to encourage local manufacturing. There is no two way about it.

seunmsg:


Some of you criticize just for the sake of criticism.

I stated my point why it's a foolish idea ...instead of you to counter my points with points you are here doing what you are accusing me off ....what did I state that is wrong and why

You're talking rubbish... you have no clue about economics. So just keep your gutter mouth seal off.

mrvitalis:
This man has proven to not know a thing about economics ......

U want distressed banks with months of losses and diminishing liquidity to reduce interests rates ? When we already have hyper inflation ?

This is even worst than the printing money idea

[s]

piggyyeaster:
iyanmiri engris

[/s]

[s]

piggyyeaster:
Presidential material
Jagaban himself
Slayer of Ibo party
May you live long to rule to rule Nigeria

[/s]

The funds the Govt is supposed to give with reduction of interest rate as Tinubu stated is borrowed at a huge interest rate, while the crude oil which is supposed to cushion effects is near zero and our debt to revenue is almost 50%.

Lipscomb:
You're talking rubbish... you have no clue about economics. So just keep your gutter mouth seal off.

I dare u to quote any theory that supports him

mrvitalis:
This man has proven to not know a thing about economics ......

U want distressed banks with months of losses and diminishing liquidity to reduce interests rates ? When we already have hyper inflation ?

This is even worst than the printing money idea

You're talking to someone that successfully steered a state for 10months without federal allocation...you don't know what you're saying sir.

funshint:

You're talking to someone that successfully steered a state for 10months without federal allocation...you don't know what you're saying sir.

When would be people stop this lies ...they only stopped local government allocation not state ...no body has the power to stop state allocation

Two name one landmark tinubu project in Lagos

What sort of useless economic advise is this? This Corona Pandemic have really exposed some people intellectual deficiencies.

How can you ask for interest rates reduction from banks barely trying to stay afloat. Did the government give any bank or SMEs subventions or stimulus package? Tomorrow, uncle would come and deny making any statement like this. From printing more money to this. Oluwole economist.

Good insight,if adhered to.

God bless you Sir.

God bless Nigeria!!!

mrvitalis:
This man has proven to not know a thing about economics ......

U want distressed banks with months of losses and diminishing liquidity to reduce interests rates ? When we already have hyper inflation ?

This is even worst than the printing money idea

You are just a nuisance, an irredeemable Bigot and Igbo-centric tribalist. You guys will never agree with anything Tinubu says, however commonsensical because he is "God" of the Yorubas to you and must always be challenged or insulted.

Reduction of interest rate is a default automatic monetary action to combat this economically extreme period that inflation does not matter and should not factor into economic thinking because every intelligent person agrees that access to money through whatever means, especially lower interest borrowing, is critically important for many now who must simply worry about survival today and everything else later!!!!

Nigeria was already running at very high interest rate anyway that was an impediment to economic growth in normal times let alone now that people and institutions desperately need very quick and urgent access to cash.

The government must subsidize access to that cash anyway they can and reducing interest rate is an inevitably obvious way to go. If not that you are a tribalist who has no shame, and cannot help himself, would you not appreciate how dumb and hateful you sound because you rushed in to oppose Tinubu without engaging your brain?

UK already running very low interest rate for many years, due to the credit crunch debacle, has cut rate from 0.75% to 0.25% and you are here, merely because Tinubu suggests interest rate cut, arguing Nigeria Maintain rate that is counter-productively running at 15%. Very bad for normal times and an economic suicide rate for Covid-19 times!!!!!!

Bruv, you and others like you should stop commenting here Biko. You guys have nothing to add other than oppose everything Tinubu says out of ethnocentric hatred of the man. It is tiring and the reason I call you Igbos enemies-within. You are of no use to Nigeria.

https://www.google.com/amp/s/www.bbc.com/news/amp/business-51831004

UK interest rates cut in emergency move
By Szu Ping Chan
Business reporter, BBC News
11 March 2020

The Bank of England has announced an emergency cut in interest rates to shore up the economy amid the coronavirus outbreak.

Policymakers reduced rates from 0.75% to 0.25%, taking borrowing costs back down to the lowest level in history.

The Bank said it would also free up billions of pounds of extra lending power to help banks support firms.

It comes as the chancellor is expected to announce further measures to support growth and jobs in the Budget later.

strykr:
What sort of useless economic advise is this? This Corona Pandemic have really exposed some people intellectual deficiencies.

How can you ask for interest rates reduction from banks barely trying to stay afloat. Did the government give any bank or SMEs subventions or stimulus package? Tomorrow, uncle would come and deny making any statement like this. From printing more money to this. Oluwole economist.

Some of you guys are so ignorant and shameless. You then go on to expose your lack of knowledge and localized hate of personalities like Tinubu to the world.

Central banks set interest rates that all banks secure loans at from the Government. The banks then lend to the public at that CBN rate (Central Bank of Nigeria rate) with an addition to facilitate profit on their lending.

For example, if CBN interest rate is 5% then decent Nigerian banks, lending at that rate from the Government, have no business lending to the public at rates higher than 6-7% at this critical time where access to cash is critical for every sector from agriculture to manufacturing otherwise everything crashes on our collective heads for anarchy, chaos and panic to reign. In short every qualifying condition that leads to a nation being announced as economically failed.

Ironic an olodo like you is citing others as "intellectually deficient". You succinctly highlight the problem of Nigeria i.e too many tribalistic, hateful, stubborn and ignorant clowns running around talking and yapping cluelessly instead of committing themselves to listening and learning.

Why not show a pix of your father n leave NL to determine who should be taken seriously and who the fool is ?

I said that because judging by achievement your father is doomed to be the FOOL that his generation dead alive n unborn will never accomplish what Tinubu achieved even if we wait till Jesus come n go but to give him a chance so his Igbotic soul does have a fair chance, post his pix let NL determine.

NwaNimo1:
What fool would take this man seriously?

[img]https://media./images/fc60d29b491774d6addabd1a2292cc16/tenor.gif[/img]

NwaNimo1:
What fool would take this man seriously?

What sane person would take you seriously? A very childish and immature fellow low on intellect and long on tribalistic hatred of others.

Tinubu u disappoint ur ancestors u failed already because u are part of those who imposed this useless evil govt because u want to b next president u will b consumed by ur greed n thirst for power soon greedy old man

One thing I so much love about Tinibu is that he has good, smart and intelligent guys to occupy public offices like Ambode, Sanwo-Olu and Osibanjo. He's a smart godfather I will be happy to work for him come 2023 presidential election.

GOOD BUT WHERE'S THE LOAN? HOW DO YOU GET IT?