By Chidi Nkwopara
The Central Bank of Nigeria, CBN, has said the recent bailout funds were not mere freebies but guaranteed structured loans to states.
The CBN Director of Corporate Communications, Mr Isaac Okoroafor, disclosed this, weekend, at a one-day interactive enlightenment session with stakeholders on measures by CBN to ensure stability in the financial system and economy in Owerri.
“The structuring of the bailout funds was done as a loan to the states, so it is a long-term loan to the states and they are guaranteed,” Okorafor said.
Explaining the CBN’s intent in doling out the funds, Okorafor said: “It was done to create an environment where workers who could not be paid, received their salaries and have the purchasing power to go to the market and buy their needs.
“With this, the producers of such products can go back and produce again, and that was one of the reasons we were able to pull out of recession.”
While adding that some states used the bailout funds for other issues, Okorafor said there was little CBN could do about it.
On CBN’s intervention in the textile industry, Okorafor said management of the apex bank was aware that if a part of the value chain was fixed, others do not need to be fixed, as the effects would trickle down.