The Vice President of Nigeria, Prof. Yemi Osinbajo, has dismissed the rumors that have been circulating recently claiming that the Central Bank of Nigeria, CBN, was printing money to support the Federal Government.
The question was directed at the Vice President at the Nigeria Civil Society Situation Room Dialogue in Abuja, and he described the claim as completely “absurd”. Osinbajo, however, acknowledged that the CBN had intervened in the agricultural sector, but noted that the measure was not illegal and the amount expended was not significant.
A member of the CBN’s monetary policy committee, MPC, was quoted in a leaked minutes of meeting as saying the apex bank was providing a “piggy bank” service to the federal government.
Osinbajo replied “That is certainly false. I think it is very sad that this is being circulated. I think the whole idea that that the CBN is printing money to support government is completely absurd. And the context on which it was accredited to the person I think it was completely misunderstood.”
“If you look at our M1, M2, the amount of money being circulated is within appropriate limits. And inflation has continued to go down month by month. Honestly, if there is money out there way beyond limit then we should expect that inflation will begin to go up. But that is not the case. Of course, there has been a firm-up on government borrowing and that is significant and we have been very upfront about what we are doing.”
“The DMO (Debt Management Office) is required to publish the debt profile of government regularly and only three weeks ago the last debt profile was published. The government has largely funded its activities through the treasury bills.”
“There is no law that says the CBN should not intervene in agriculture. I personally believe that interventions are important especially in areas that government has funds. But how much has CBN expended? So far on the anchors borrowers programme (ABP), it has expended N52 billion and that is not a significant amount of money. The budget is about N7 trillion.”