Intervention Funds Will Lower Cost of Production Says CBN

• Intervention Funds Will Lower Cost of Production Says CBN

The Central Bank of Nigeria has said intervention funds available to farmers will curb the rising cost of production and force down the temporary increase in the price of local rice and other items.

Intervention funds are low-interest loans designed to support local businesses.

In a series of tweets, the CBN said: “CBN Intervention funds to farmers will bring down the cost of production, price hike on rice is a temporary phenomenon that will fizzle out soon.”

The central bank explained that to reduce the number of businesses filing for bankruptcy and improve job creation, policymakers do not have other option but to take a stand against smuggling and dumping in Nigeria.

The World Bank had put the number of businesses that shut down in Nigeria in 5 years at 322 and over 1,100 others are said to be at risk of shutting down.

With Nigeria’s unemployment rate currently at 23.1 percent or 20.9 million of working population, the government needs to create an enabling environment for local businesses, especially with the borders now closed.

“To solve the problem of industries dying, to resolve the problem of creation of jobs, we, as policymakers do not have any other option than to take seriously the issue of smuggling and dumping in Nigeria,” the CBN tweeted.

Available data have shown border closure is aiding economic productivity and gradually turning Nigeria from an import-dependent economy to a consumption-based economy.

This is evident in the surge in sales of local rice and the increase in the number of jobs created in the agricultural sector in recent months.

Also, border closure has helped moderated national daily petrol consumption from 60 million litres per day to 52 million litres as smugglers can no longer access borders to neighbouring countries.

Therefore, with efficient intervention funds, the CBN would be able to up local productivity, increase job creation and improve foreign reserves.