The strategy to tackle inflation by addressing the issue of excessive liquidity in the system will involve the Federal Government utilizing Ways and Means advances, according to Wale Edun, the Minister of Finance and Co-ordinating Minister of the Economy.
Edun made this revelation in Washington DC after engaging with investors during the ongoing spring meetings of the International Monetary Fund and the World Bank.
Earlier in February, the Governor of the Central Bank of Nigeria, Olayemi Cardoso, had declared that the bank would stop providing Ways and Means advances to the federal government until all outstanding debts are settled.
Nevertheless, Edun asserted that both fiscal and monetary authorities are collaborating to combat inflation.
Edun stated, “The two authorities are working together to reduce inflation and price instability, stabilize the exchange rate, and lower interest rates to facilitate more affordable borrowing for investors, ultimately steering the economy in the right direction.”
He also emphasized the necessity to reduce borrowing and increase focus on domestic resource mobilization to secure long-term resources and alleviate repayment and refinancing pressures.
Regarding food security, Edun revealed that the current administration is prioritizing farmers’ access to their land, especially in regions where insecurity has obstructed food production significantly.
In collaboration with the African Development Bank (AfDB), efforts are made to establish agro clusters to enhance food output in the nation.