Chairman/Chief Executive Officer of the Dangote Group, Aliko Dangote, has said hike in interest rate will increase unemployment and hamper national growth.
The multi-billionaire businessman said this on Tuesday while speaking at the opening session of a three-day National Manufacturing Policy Summit.
The summit, organised by the Manufacturers Association of Nigeria (MAN), was held at the Banquet Hall of the State House, Abuja.
Dangote said nobody can create jobs with an interest rate of 30 per cent. He added that there cannot be any growth or prosperity.
“Before I delve into my paper, let me start with some key messages. “Nobody can create jobs with an interest rate of 30 per cent. No growth will happen. No power, no prosperity. No affordable financing, no growth, no development,” he said.
Dangote made the comment on the heels of a decision by the Monetary Policy Committee of the Central Bank of Nigeria (CBN).
The Committee agreed to increase the Monetary Policy Rate for the third consecutive time from 24.75 per cent to 26.25 per cent.
MPC held its 295th meeting on 20-21 May, 2024. It reviewed recent economic and financial developments in the country and to assess risks.
The apex bank thereafter resolved to “Raise the MPR by 150 basis points to 26.25 per cent from 24.75 per cent,” the CBN Governor, Yemi Cardoso, announced.
Dangote however said at the MAN Summit that there is no possibility of growth under such circumstances.
He therefore called on the government to protect local businesses in the country, especially manufacturers. This he said can be done by providing an enabling environment for them to thrive.
He said import-dependence equals poverty importation. He added that, to tackle unemployment, poverty and insecurity, the manufacturing sector must be empowered to function optimally.
“Let me therefore conclude by reiterating that Nigeria has all it takes to develop and sustain a globally competitive manufacturing sector. But to do so, we must re-think our industrialisation policy.
“We must look to leading countries in the West and the East who are actively protecting their domestic industries.
“We must similarly enact policies to protect our domestic industries. We must nurture them into home grown champions that will create the jobs and prosperity we desperately need,” he said.
Dangote admitted that there are various factors contributing to the underperformance of the manufacturing sector. He however emphasised that the crucial issue requiring attention is government policy and its approach toward investments and investors.
He pointed out that industrial or manufacturing entities are not like trading entities. He said the fundamental role and responsibility of government should be not only to promote investments and attract investors in manufacturing.
He said it must also to ensure that the investments are nurtured and protected to facilitate growth and sustainability.
“In every economic regime, including the most advanced, investment projects in manufacturing and industrial sectors need time and a conducive environment for them to mature, build capacity and scale, to become competitive against those in older and more mature markets.
“But since the mid-1980’s non-industrialised countries and their leaders have been discouraged from protecting and supporting such investment.
“They are forced to expose them to unfair competition from stronger, older competitors in their own internal market, even before the newcomers are commissioned.
“Yet these same older/bigger players are well supported in their home markets,” the multi-billionaire business magnate said.
