Withdrawal of forex for milk importation imminent – Emefiele

The Central Bank of Nigeria (CBN) on Tuesday doused speculations about the monetary authorities’ plan to remove milk from the list of items being supported with foreign exchange from the official windows, saying that the decision to do so is imminent.

This is even as the Monetary Policy Committee of the apex bank ended its two-day meeting with the retention of the Monetary Policy Rate (MPR) at 13.5%, Cash Reserve Ratio (CRR) at 22.5% and other key rates unchanged.

Emefiele, while reacting to media enquiries on the rumours milling round on the planned  de-listing of milk  from official forex-supported imported items, said that it was no longer desirable for Nigeria to keep spending  between USD 1 billion to USD 1.2 billion monthly on milk when the country had it required to meet the local demand for the commodity.

According to him, the apex bank had over the past few years engaged major manufacturers and importers of milk on discussions about how to optimise the local production and assured them of its readiness to support their activities, including their backward integration programs and investments.

He explained that the initiatives were undertaken by the bank to make Nigeria self-sufficient milk, reduce the pressure on the natin’s foreign reserves, reduce the escalating clashes between herdsmen and farmers, improve the nutritional quality of milk being consumed by Nigerians and also create jobs, amongst other objectives.

The governor said that despite the recent opposition of some groups to the proposed monetary measure on milk importation, the CBN was determined to see the measure come true very soon in view of the multi-dimensional socioeconomic benefits for the country.

Expatiating further on the new Lending-Deposit Ratio of 60% it unveiled a few days ago, Emefiele said the policy measure was introduced to improve lending by the Deposit Money Banks (DMBs) to encourage them in their monetary intermediation roles in the economy.

While citing LDRs in other economies, including the United States of America and South Africa with 75% and 95% LDRs respectively to buttress his points, the CBN governor said that even at the current 60% LDR for Nigerian banks, the rate remained amongst the lowest in some of the countries analysed.

Emefiele said the CBN was determined to continue to promote measures that would stimulate sustainable growth in the real sector through lending at lowest rates, reduce inflation to single digit and ensure financial system stability, amongst other micro and macroeconomic targets.