United Capital Group has endorsed the Central Bank of Nigeria's (CBN) initiative to work closely with relevant parties on upcoming intervention efforts. This endorsement was communicated through a brief report released after an interview with CBN Governor, Dr. Olayemi Cardoso, on Arise TV.
Dr. Cardoso mentioned that future plans by the CBN would include collaboration with experienced stakeholders and entities. United Capital praised this move as smart and visionary, highlighting that involving stakeholders not only enhances market inclusivity but also boosts economic confidence. The collaboration is expected to bring diverse viewpoints to the table, aiding in more comprehensive decision-making.
The asset management firm also anticipates a slight positive impact on the naira's value following the successful execution of CBN's policies. Nonetheless, it acknowledges the current low investor confidence impacting the economy and suggests that improving this confidence could lead to the naira's appreciation.
United Capital stresses the importance of Nigeria boosting its crude oil output and revitalizing its non-oil sectors to diversify income streams, which would, in turn, support the naira's strength.
The firm believes the CBN's new communication strategy regarding its decisions and the Monetary Policy Committee's efforts to tackle inflation will be crucial in educating the public and ensuring transparency.
Dr. Cardoso acknowledged the necessity of interventions in Nigeria, considering its vast land and population. He emphasized the importance of ensuring that intervention efforts reach their intended beneficiaries and that they are effective in meeting their goals, rather than being wasted or misapplied.
The focus will be on collaboration with both domestic and international experts and organizations to ensure the success of these interventions, moving away from solely bank-led initiatives to a more inclusive approach.
Dr. Cardoso concluded by highlighting the urgency of avoiding failed interventions, especially given the current economic challenges like inflation and exchange rate concerns, to ensure that the benefits reach those in need, particularly those lower in the economic hierarchy.
As of October 2022, the CBN had allocated approximately N9 trillion for various intervention projects.
Oluwakemi, a Senior Correspondent with The PUNCH, with over a decade of experience in both digital and traditional journalism, primarily reports on the Capital Market.
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