#CBN governor hints on reduction in price of petrol and inflation as Tinubu’s govt targets 77% increase in IGR

The Central Bank of Nigeria (CBN) Governor, Dr. Olayemi Cardoso, has indicated a potential reduction in fuel costs, anticipating a decline in inflationary pressures in 2024 due to the CBN’s inflation-targeting policy. He emphasized the undervaluation of the naira and hinted at Nigerians witnessing a reduction in petroleum product prices. Speaking at the launch of the Nigerian Economic Summit Group’s Macroeconomic Outlook for 2024, Cardoso highlighted positive outcomes from bold reforms, with international rating agencies upgrading Nigeria’s ratings. The expected moderation in pump prices of premium motor spirit (PMS) in 2024 is crucial for economic efficiency, resilience, and reduced inflation. The CBN’s inflation-targeting framework aims to rein in inflation to 21.4 percent, supported by improved agricultural productivity and eased global supply chain pressures. Cardoso expressed optimism about decreasing inflation having a profound impact on businesses, providing a more predictable cost environment and potentially leading to lowered policy rates, stimulating investment, growth, and job opportunities. The CBN has returned to a conventional monetary policy approach focused on achieving price stability for sustainable economic growth. Initiatives in foreign exchange collaboration are yielding positive results, contributing to expected stability in the foreign exchange market for 2024. The federal government targets a 77% increase in Internally Generated Revenue (IGR) through a newly integrated tax approach, aiming for an 18% tax-to-GDP ratio. The Finance Minister, Wale Edun, expressed hope in surpassing the target and shifting from expensive debts to domestic revenue mobilization, emphasizing the need to boost revenue for infrastructure and social services. The tax collection methodology of the Federal Inland Revenue Service (FIRS) is restructured to simplify the taxpayer experience and improve efficiency.