The National President of the Nigerian Association of Chambers of Commerce, Industry, Mines, and Agriculture (NACCIMA), Hon. Dele Kelvin Oye, has strongly criticized Nigeria’s high interest rates, arguing that they are stifling entrepreneurship and hindering the country’s economic growth.
Speaking at the All Nigerian Editors’ Conference 2024 in Yenagoa, Bayelsa State, Oye highlighted the disconnect between the Central Bank’s policies and the needs of Nigerian businesses. He stated that the current high interest rates, which peak at 35-40%, are detrimental to businesses and entrepreneurship, noting that the Nigerian government’s economic policies seem more aligned with political interests than with fostering productive enterprises.
“High interest rates—ranging between 35 and 40 percent—are a clear sign of a central banking system out of touch with the realities of the Nigerian economy,” Oye said. “This, coupled with a 21.25% government bond yield in August 2024, has made local banks prefer investing in bonds over lending to businesses. This trend is discouraging entrepreneurship and stalling economic growth.”
Oye also pointed out the widening gap between banking profits and support for industrial growth, citing Zenith Bank’s reported one trillion-naira profit in Q3 2024, despite the lack of significant lending to businesses.
The NACCIMA president further criticized the management of Nigeria’s foreign exchange market, citing the naira’s depreciation from N460.70 in May 2023 to N1,735 per dollar by November 2024. He argued that the government’s laissez-faire approach to exchange rate management had left businesses vulnerable to volatility, worsening economic instability and contributing to widespread hunger and poverty.
“The lack of stable, transparent exchange rate policies has been a major factor in the economic distress faced by Nigerians,” Oye added. “It has caused serious instability, which harms businesses trying to plan and operate in such an uncertain environment.”
Oye also raised concerns about the lack of clear fiscal policies, which he said is stifling business planning as companies approach the end of the 2024 financial year. He lamented the lack of clarity on tax policies, urging that businesses cannot thrive in an environment of uncertainty.
“We are operating in a fog of policy inconsistency, which is pushing many businesses to relocate to more stable countries,” Oye said. “This is preventing growth, innovation, and long-term investments.”
On the broader economic structure, Oye criticized the escalating cost of governance, particularly the judicial, legislative, and executive branches, which he believes are becoming increasingly unsustainable for the economy. He argued that the current framework disproportionately benefits the political elite over the working class, making it harder for productive industries to thrive.
“Much of the wealth in developing nations like ours seems to be derived from holding political office rather than from productive enterprises,” Oye said. He proposed that legislators should serve on a part-time basis and be funded by their constituents or state governments, in order to reduce the burden of maintaining a costly political elite.
Oye also raised concerns about the country’s tax system, arguing that it favors the political class rather than the productive sectors of the economy. He stressed that tax revenues should be reinvested in infrastructure and community development, rather than inflating government spending through the Federal Accounts Allocation Committee (FAAC) disbursements, which often fail to deliver tangible results for citizens.
In his remarks, Oye warned against over-taxation, saying that no state should tax its citizens beyond their capacity and still expect economic growth. He also cautioned the Tinubu administration against engaging in a blame game with the World Bank over the impacts of its policies. Instead, he urged the government to take full responsibility for its actions.
“While understanding the historical context is important, the government must focus on its present and future policies, taking full ownership of the decisions it makes,” Oye said.
Oye concluded by urging media professionals to take a more active role in holding both government and corporate entities accountable. He emphasized the importance of transparency in restoring public trust and fostering long-term, transformative growth for Nigeria.
“The media must step up as the fourth estate, ensuring accountability and protecting the public from poor policies, corruption, and abuse of power,” he said. “The future of Nigeria is in our hands. Together, we can create a narrative of growth, transparency, and sustainable development.”
