Reps seek single- digit interest rate

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Written by Abdullateef Abubakar Jos

The resolution was sequel to a motion moved by Rep. Nadu Karibo (

PDP-Bayelsa), which was unanimously adopted without debate.

Karibo told his colleagues that the policy would encourage the growth of

small-scale businesses and the manufacturing industry.

He noted that the Monetary Policy Rate of any country, which is fixed by the

Central Bank, determined the rate at which banks accessed funds and the rate

at which they lent money to investors and businesses.

Karibo said that Nigeria's benchmark interest rate of 12 per cent ranked it

among countries with very high interest rates in the world, with the resultant

lending rate of between 17 per cent and 25 per cent or more.

The legislator said that with the high interest rate, new investors might find it

difficult to raise money and when they managed to do so, it would be difficult or

impossible to repay.

He said that Switzerland had a benchmark interest rate of zero per cent, Japan

0.25 percent , U.S. 0.25 per cent, UK 0.50 per cent and Singapore 0.03 per

cent.

Other countries he cited to buttress his claim were Netherlands 0.75 per cent ,

U.A.E. one per cent, Trinidad and Tobago 2.75 per cent, Tunisia 3.75 per cent,

Togo 4 per cent, Niger 4 per cent and Namibia 5.5 per cent.

Commenting on the motion, Rep. Aminu Suleiman (PDP-Kano), said that if the

interest rate was reduced, more investors would invest in the country and more

jobs would be provided for unemployed citizens, especially youths.

However, Rep. Kamil Akinlabi (ACN-Oyo), said that fixing the benchmark interest

rate was not in the purview of the CBN.

Members who supported the motion were not categorical on the rate that would

be acceptable but suggested that it should be below the current rate.