A recent economic report indicates a shift in credit dynamics within the Nigerian economy.
The projection anticipates a decrease in government borrowing while expecting private sector credit to rise in the coming months.
This shift is driven by the government’s goal of achieving higher economic growth primarily through the private sector.
The report suggests that credit to the government is poised to decline due to the expected significant reduction in fiscal deficits following the removal of fuel subsidies.
In contrast, credit to the private sector is predicted to increase, aligning with the government’s strategy to foster growth with strong private sector participation.
Additionally, the report highlights a drop in borrowing by farmers for agricultural cultivation. Borrowing in this sector declined from N1.85 trillion in January to N1.83 trillion in June, indicating a reduction in the appetite for loans among farmers.
Salihu Imam, the Chairman of an agricultural association, emphasized the importance of reducing lending costs in order to stimulate agricultural expansion and enhance food security in the nation.
He described affordable loans as a necessity for the growth of the agricultural sector, essential for the well-being of the nation.
Imam emphasized that providing affordable loans represents an investment in Nigeria’s collective future, contributing to both food security and economic stability.
The report’s projection, along with the agricultural sector’s call for reduced lending costs, underscores the evolving economic landscape and the potential for positive changes in credit dynamics.