3% GDP Growth Rate Predicted For 2019 – Nigerian CBN Governor, Emefiele

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In 2018 the Nigerian economy saw grow by 1.93%, the governor of the Central Bank of Nigeria (CBN), Mr. Godwin Emefiele, predicted on Thursday that the Nigerian economy would grow by three per cent in 2019. According to Emefiele, the growth in the 2018 economy was achieved because CBN maintained a tight monetary policy and that helped to rein in inflation which he said was expected to rise to 12 per cent in the course of the year before moderating, for this reason, he said that the central bank would continue to maintain a tight monetary policy.

Recall that the Minister of Industry, Trade and Investment, Dr. Okechukwu Enelamah, recently said that all hands must be on deck if Nigeria must experience an economic growth, according to the Minister, to stimulate the economic growth, Nigerians must support the governments policies and to achieve this, Nigerians must be ready to pay higher taxes.

CBN

While addressing participants at the BusinessDay Post Election Outlook Conference in Lagos, the CBN governor expressed optimism that before the end of the second quarter of 2019, the economy will witness a positive growth and that there will be an improvement in the labor market. But he noted that the nations economic policy rate will be determined by the prevailing conditions and outlook since the present benchmark interest rate has remained 14% since 2016.

READ ALSO: Nigeria’s $10bn Oil Palm Industry To Be Revived Through CBN/Federal Government Collaboration

Inflation figures released by the National Bureau of Statistics (NBS) showed a moderate decline in the Consumer Price Index in February to 11.31 per cent.

While basing the inflationary projection on productivity gains in the agricultural and manufacturing sectors, he anticipated that the GDP would pick up in the first half of the year, owing largely to continued efforts at driving indigenous production in high-impact real sector activities.

Speaking on the exchange rate policy, the CBN governor said that though present indices points to the fact that the crude oil market may face strong volatility, the apex bank would maintain its stable exchange rate over the next year. According to him,

“gross stability is projected in the foreign exchange market, given increased oil production and contained import bill.”

The CBN boss said that he sees the country’s Balance of Payments maintaining a positive ground in the short-term, he said that as long as crude oil prices continue to improve, the nation’s current account balance could improve further, he also said that this would be,

“supported by improved non-oil performance as diversification efforts begin to yield results to reduce undue imports.”

So that the nation does not fall back into the economic crisis that she suffered between 2015 and 2017, Emefiele warned that the country’s external reserve must be increased through increase in the country’s policy buffers and fiscal measure.

According to him, the government was already taking steps to ensure that it generates enough revenue outside oil to ensure growth and development, adding that it requires the cooperation of the citizens.

“There is no doubt that we need to focus on growing revenue as a government, six, seven or eight per cent of GDP is not good enough. In my view if we all chose to pay our taxes or handle the tax issue in a way that was more effective, we will be better.

“The people who should be paying taxes are not paying. Most of us are not paying. The ones that are paying are the companies or the ones that are on our records. I do think that there are many strategies that can be used to improve tax collection and improve the social contract between the government and taxpayers and the government is looking at that and I think we would see better results.

“If you look at other countries, whether developed or developing countries, everybody is in double digit in terms of tax revenue collection to GDP, Nigeria is still doing single digit and there is no explanation that would suffice.

“In Nigeria we say government has been providing infrastructure why should we be paying taxes. Well I think we need a new social contract, if we are building infrastructure, we should be paying taxes,” the minister said.

“If you look at other countries, whether developed or developing countries, everybody is in double digit in terms of tax revenue collection to GDP, Nigeria is still doing single digit and there is no explanation that would suffice.

“In Nigeria we say government has been providing infrastructure why should we be paying taxes. Well I think we need a new social contract, if we are building infrastructure, we should be paying taxes,” the minister said. a new social contract, if we are building infrastructure, we should be paying taxes.”

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