LAGOS, Nigeria (VOICE OF NAIJA)- The Chairman and Chief Executive Officer of the Dangote Group, Aliko Dangote has raised concerns about the CBN interest rate.
He said that increasing the interest rates would adversely impact local manufacturers.
Dangote stated this during the inaugural session of a three-day National Manufacturing Policy Summit hosted by the Manufacturers Association of Nigeria at the Banquet Hall of the State House, Abuja.
“Before I delve into my paper, let me start with some key messages.
“Nobody can create jobs with an interest rate of 30 per cent. No growth will happen. No Power, no prosperity. No affordable financing, no growth, no development,” he said.
His remarks follow the decision of the CBN’s Monetary Policy Committee to raise the Monetary Policy Rate for the third consecutive time, from 24.75 per cent to 26.25 per cent.
The Monetary Policy Committee convened its 295th meeting on May 20-21, 2024, to evaluate recent economic and financial developments in the nation and to gauge associated risks.
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After the meeting the apex bank resolved to “Raise the MPR by 150 basis points to 26.25 per cent from 24.75 per cent,” the CBN Governor, Yemi Cardoso, who chairs the MPC announced
During his speech at the manufacturer’s summit on Tuesday, Dangote emphasized that under such conditions, he sees no prospects for growth.
Additionally, the business mogul urged the government to support existing businesses in the country, particularly manufacturers, by creating a conducive environment for their prosperity.
He asserted that relying on imports leads to economic vulnerability and perpetuates poverty.
Dangote contended that empowering the manufacturing sector to operate at its best is crucial for the government to tackle unemployment, poverty, and insecurity effectively.
“Let me therefore conclude by reiterating that Nigeria has all it takes to develop and sustain a globally competitive manufacturing sector. But to do so, we must rethink our industrialisation policy.
“We must look to leading countries in the West and the East who are actively protecting their domestic industries.
“We must similarly enact policies to protect our domestic industries and nurture them into home grown champions that will create the jobs and prosperity we desperately need,” he said.
Dangote highlighted that while several factors contribute to the underperformance of the manufacturing sector, the primary concern lies in government policies and their approach to investments and investors.
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He emphasized that industrial and manufacturing enterprises differ significantly from trading entities.
Dangote expressed his belief that it is essential for the government not only to promote investments and attract investors in manufacturing but also to ensure that these investments are nurtured and protected to foster growth and sustainability.
“In every economic regime, including the most advanced, investment projects in manufacturing and industrial sectors need time and a conducive environment for them to mature, build capacity and scale, to become competitive against those in older and more mature markets.
“But since the Mid 1980’s non-industrialized countries and their leaders have been discouraged from protecting and supporting such investment and forced to expose them to unfair competition from stronger, older competitors in their own internal market, even before the newcomers are commissioned. Yet these same older/bigger players are well supported in their home markets,” he said.