Monetary, Fiscal Authorities Agree on Harmonisation of Policies

Desirous of sustainable monetary and fiscal collaboration in efforts to pull the economy out of the current crisis, the leadership of the Central Bank of Nigeria (CBN) and the ministries of Finance, Budget and National Planning as well as Trade and Investment, at weekend, sought to harmonise several policy perspectives.

Speaking at the opening of the two-day Monetary Policy Committee (MPC) retreat at the CBN’s Corporate Headquarters in Abuja at the weekend, with the theme: “Pathway to Price Stability Conducive to Economic Growth,” the apex bank Governor, Godwin Emefiele, under whose auspices the meeting was convened, reiterated the need for the country’s monetary and fiscal authorities to collaborate and harmonise standpoints to develop the economy rapidly.

Emefiele, who also chairs the Monetary Policy Committee, said the MPC Retreat, which for the first time had in attendance a large representation of the fiscal authorities, was coming at a period when the country faced serious economic challenges.

MPC Committee members
He added that finding a sustainable solution required a broadened participation of colleagues from the fiscal side.

He said that the retreat, as a brainstorming session, would provide perspectives on certain Monetary Policy Committee decisions.

The banker said it would also close the gap on the coordination between monetary and fiscal authorities to chart a common course and take decisions to develop the economy.

The Minister of Budget and National Planning, Senator Udoma Udo Udoma, said both the monetary and fiscal authorities had no choice but to work together to guarantee the country’s economic growth.

He maintained that the pathway to lower interest rate was to ensure monetary and fiscal authorities’ collaboration with the private sector.

Also, the Minister of Finance, Mrs. Kemi Adeosun, and her counterpart in Industry, Trade and Investment, Dr. Okechukwu Enelamah, agreed that solving the challenges facing the economy required unconventional tactics.

Adeosun, while disclosing that there remained a huge number of unbanked Nigerians whose contributions to the economy are hardly captured, said the government must devise ways to bring them into the financial mainstream.

She also hinted that based on the current realities, the Federal Government would have to borrow more to meet its infrastructural obligation.

Enelamah emphasised the need for both monetary and fiscal authorities to ensure the return of business, market and investor confidence, as well as policy integrity, to improve on the ease of doing business in Nigeria.

In her presentation entitled: “The Macroeconomic Tri-lemma and Monetary Policy in Nigeria,” the Deputy Governor, Economic Policy, Central of Bank of Nigeria (CBN), Dr. Sarah Alade, said the onus of achieving the low interest and exchange rates, as well as low inflation should not entirely be the function of the monetary authority.

She said the task therefore, necessitated the collaboration with fiscal authorities, as there was need for deliberate policies to ensure stability and engender growth in the economy.