Stakeholders and experts in the nation’s financial market have said the Central Bank of Nigeria’s intervention in the area of COVID-19 is capable of fast-tracking the recovery process.
The Chief Executive Officer of BIC Consultancy Services, Boniface Chizea, said; “I think the size of the intervention we have seen from the CBN is more than adequate to spur a growth trajectory. What we should worry about is effective deployment.
“If properly deployed, we will see a ‘V’ curve as against a ‘U’ curve recession and from there, we can go on to attain the 2 per cent growth projected for 2021 that is if the coronavirus pandemic falters before the fourth quarter of 2020.”
A V-shaped recovery involves a sharp rise back to a previous peak after a sharp decline in the metrics. Because of the speed of economic adjustment and recovery in macroeconomic performance, a V-shaped recovery is a best case scenario given the recession.
Chizea added: “People have started to ignore the dangers of the virus because we have to protect both life and livelihood. We are now developing protocols for restarting businesses and this is important because we have to get people working.
“As a government, we must quickly address insecurity as that will have an impact on farmers and the intervention in that sector may suffer once we lose the opportunity of the planting season.”
Professor of Capital Market at the Nasarawa State University, Keffi, Uche Uwaleke, said the government should channel the bulk of its loans to financing infrastructure, especially off-grid quick power solutions.
He said: “Local manufacturers face a high cost of production made worse by the high interest rate environment. To address this challenge, the government should channel the bulk of loans it is taking this year to infrastructure, especially power with emphasis on off-grid quick solutions.
“This will go a long way in not only reducing production costs, but also enhancing the standard and quality of products. Also, local manufacturers require off-takers so that the production line is not interrupted.”
For the CBN Governor, Godwin Emefiele, the monetary interventions are not merely to contain the impact of the coronavirus on the economy.
He sees it as the time to fully transform Nigeria into a modern, sophisticated and inclusive economy that is self-sufficient, rewards the hard-working, protects the poor and vulnerable, and can compete internationally across a range of strategic sectors.
Emefiele said: “In order to achieve this goal, we must begin immediately to support the Federal Government to build a base of high quality infrastructure, including reliable power that can engender industrial activity; support both smallholder and large scale agriculture production in select staple and cash crops.
“Create an ecosystem of factories, storages, and logistics companies that move raw materials for value-added production, and finished goods to markets; use our fiscal priorities to create a robust educational system that enables critical thinking and creativity, which would better prepare our children in future.”