Despite current macroeconomic challenges confronting the Nigerian economy, the financial sector has remained resilient, strong and profitable, President, Chairman of Council, Chartered Institute of Bankers of Nigeria (CIBN), Ken Opara has said.
He said that 13 commercial banks in Nigeria increased their earnings by 25 per cent in the first quarter of 2022 recording a total of N1.54 trillion. The banks, he added, were able to record improved bottom line despite the CBN monetary policy leaning towards a dovish direction that is, keeping interest rates low.
Opara spoke at the second edition of the Mid-Year Review of the Economic Outlook 2022 event organized by The Chartered Institute of Bankers of Nigeria Centre for Financial Studies in collaboration with B. Adedipe Associates Limited.
Given these myriad of challenges existing in the Nigerian economy, it has become important to take a broader outlook on these issues and proffer possible solutions in order to avoid repeating failures of history.
He said that ranked 131st amongst 190 economies in the ease of doing business, Nigeria’s economic challenges stems from insecurity, uncertainty, political, and cultural disparities.’’ Lately, we contend with scarcity and skyrocketing prices of fuel and an incessant collapse on the national electricity grid, resulting in frequent blackouts.
“These challenges have affected businesses and livelihoods across the nation, leading to the demise of several business outfits specifically, micro small and medium-scale enterprises (MSME) and the relocation of larger companies to other countries. The Nigerian economy has witnessed a paradoxical situation in the past six months as growth prospects have improved however inflationary and fiscal pressures have increased considerably, leaving the economy much more vulnerable,” he said.
According to IMF, “Economic recovery continues to gain strength on the back of services and agriculture with GDP growth reaching 3.6 per cent in Quarter one 2022. Latest data shows economic growth broadening to all sectors except oil, where production remains weak reflecting continued security and technical challenges”.