MAN and LCCI Welcome Rate Cut, Stress Need for Lower Lending

The Manufacturers Association of Nigeria (MAN) expressed approval of the recent 350-basis-point reduction in the monetary policy rate, viewing it as a positive development that could alleviate financial pressures on businesses and bolster manufacturing activity. Segun Ajayi-Kadir, MAN's Director-General, stated that this reduction aligns with their calls for monetary easing after a period of economic stabilization.

He noted that the lower rate should enhance manufacturers' capacity to finance inventories, raw materials, and business expansion. However, MAN cautioned that the effectiveness of the rate cut could be diminished by the high Cash Reserve Ratio (CRR), which restricts bank lending.

They urged a review of the CRR to facilitate better lending conditions. Similarly, the Lagos Chamber of Commerce and Industry (LCCI), led by Dr. Chinyere Almona, welcomed the rate cut but stressed that its benefits depend on the actual reduction of commercial lending rates.

Almona highlighted that businesses face ongoing challenges such as high energy costs and insecurity, which could affect credit accessibility.