Former Senate President, Senator Ahmad Lawan, has raised concerns about the adverse effects of the high 34 per cent interest rate on borrowing from commercial banks, describing it as a major obstacle to business investments and food production in Nigeria.
Speaking to journalists during the flag-off of a grain and food distribution initiative for vulnerable groups in his senatorial district of Yobe North, Lawan highlighted the challenges faced by local businesses and farmers.
He noted that many are struggling to remain profitable and competitive compared to their counterparts in countries with significantly lower borrowing rates.
The food distribution, organised by the Senator Ahmad Ibrahim Lawan (SAIL) Foundation, aims to provide relief to the poor and needy during the festive period.
However, Senator Lawan stressed that such interventions are only temporary and called for a more sustainable approach to addressing the nation’s economic and security challenges.
“There is a need for those of us who can afford it to help those who are in dire need. It is no secret that many Nigerians are in a very desperate situation,” he said. “Our desire and wish is to make every Nigerian self-reliant. Bailouts like this, or stopgap arrangements, cannot solve the problems. But before we reach that destination, we have to do something like this.”
Senator Lawan urged both federal and state governments to collaborate on providing good governance and commended the Yobe State government for its efforts in supporting vulnerable groups.
He expressed optimism that the economic reforms introduced by the Tinubu administration would yield positive results by 2025 but emphasized the need for state governments to complement federal initiatives.
The former Senate President also lamented the plight of farmers in some northwestern states who have lost their livelihoods due to insecurity.
He called for proactive measures to enable farmers to return to their farms and access the necessary inputs to improve productivity.
Senator Lawan further urged the federal government to address the high interest rates charged by commercial banks, which he described as “callous” and a significant barrier to economic growth.
“We must also do something to make funds for investment accessible. Today, the interest rate is prohibitive; in fact, it is callous. In other countries, they offer half a percent interest rate, but today, in this country, it is probably 34 percent when you go to the bank to borrow. How would you invest and compete with farmers from countries that offer half a percent interest rate?” he said.
The senator reiterated the need for immediate interventions to support farmers and businesses while implementing long-term solutions to ensure sustainable economic growth.
