Olayemi Cardoso, the Governor of the Central Bank of Nigeria (CBN), has announced that the CBN will reduce its direct development finance interventions and shift its focus back to its core functions and advisory roles to support economic growth. The CBN Governor emphasized that previous leadership had included fiscal interventions within the bank’s functions, blurring the lines between monetary and fiscal environments.
In his statement, Cardoso outlined the need for the CBN to return to its primary mandate, which includes monetary policies and advisory roles aimed at promoting economic growth. The CBN’s advisory roles will involve acting as a catalyst to promote specialized institutions and financial products that support emerging sectors of the economy. Additionally, new regulatory frameworks will be facilitated to unlock dormant capital in land and property holdings, increase access to consumer credit, and expand financial inclusion for the masses.
The CBN, under its new approach, will encourage private sector investment in various sectors, such as housing, textiles and clothing, food supply chains, healthcare, and educational supplies. De-risking instruments will be employed to attract private investment, especially in sectors with significant demand patterns and the potential for high local inputs.
Cardoso highlighted the importance of the CBN’s convening power to foster partnerships between key multilateral and international stakeholders in government and private sector initiatives. This approach will help create a conducive environment for economic growth and development in Nigeria.
While acknowledging the complex challenges facing the CBN, Cardoso emphasized that the central bank does not possess a “magic wand” to solve these challenges overnight. He expressed optimism that with focused leadership and sustained reforms, the country can open up economic opportunities, attract new investments, create employment, and offer a more prosperous future for its citizens.
Some of the challenges faced by the CBN include corporate governance failures, diminished institutional autonomy, and the need to refocus the central bank on its core functions. The CBN is also working to discontinue unorthodox monetary policies and foreign currency management, address the backlog of forex demand, and ensure inflation and price stability. These steps are part of a comprehensive reform agenda aimed at repositioning the CBN for the achievement of its core mandates and contributing to Nigeria’s economic growth and stability.