By Chinwendu Obienyi
The Governor, Central Bank of Nigeria (CBN), Godwin Emefiele, says the apex bank is working on improving monetary policies suited for present realities of Nigeria’s economy.
He noted that the apex needs to address the increasing challenges confronting monetary policy formulation and implementation in Nigeria as this will facilitate access to a diverse range of financial products and credit facilities for individuals and small, medium, and large enterprises.
Emefiele, who stated this during the 2022 Monetary Policy Committee (MPC) strategic retreat in Lagos on Friday, themed; Monetary Policy Implementation: In a digitally evolving economy, said this was imperative due to the increasing challenges confronting monetary policy formulation and implementation in digital finance in Nigeria.
Whilst expressing delight at the number of initiatives the CBN has brought in the last 8 years, Emefiele said the development of these initiatives has been hampered by global financial crisis, COVID-19 pandemic, Russia-Ukraine war and global inflation.
He stressed further that stagflation is confronting the global economy noting that there is near consensus on the potential of digital finance in boosting growth performance amid the challenges.
“While the innovations come with lot of risks and uncertainties for the sectors, they also have many benefits for positive economic transformation and particularly, financial inclusion which has been the principal catalyst for inclusive growth, poverty reduction and employment generation. Digital financial services are reputed to have created 95 million job opportunities and boosted the GDP of emerging economies by 6 per cent.
Digital finance supports greater financial inclusion by making possible the extension of financial services to non-financial sectors, and to individuals with minimal access to smart electronic device”, He asserted.
According to him, the central banking and monetary policy relevance in the digital ecosystem is sometime challenged as the regulatory oversight functions are largely eroded or weakened by impotency of traditional tools in carrying out those functions.
“Indeed, while post-COVID growth recovery in Nigeria can be adjudged to be moderate and stable, we have seen a major change in the key sectoral drivers of that stable growth phenomenon, including the services sector, modernised agriculture, and manufacturing, suggesting that technology and innovation is playing a major role in output growth and economic development in Nigeria.
Hence the need to explore new ways of adapting monetary policy tools to improving the contribution of technology and innovations to the growth equation”, Emefiele noted.
When quizzed on what the impact of the retreat will bring, the CBN Governor said, “I can assure you that after this meeting, you will see a new improvement policies and new and improved Central Bank of Nigeria that will provide direction for monetary policy in Nigeria”
Earlier in his welcome remarks, the Deputy Governor, CBN, Dr Kingsley Obiora, said the use of cash is reducing across the world as payment by digital wallet exceeded payment by cash in 2021.
“This retreat aims to discuss how the CBN can respond to the changes in the rise of digital currencies. It is expedient so that we can make policies that will guide and grow our own economy”