Exchange rate, Exchange rate stability, Poverty reduction, Exchange rate policy.


The paper discusses the role of macroeconomic policy in achieving social as well as macroeconomic objectives in attaining poverty reduction in Nigeria. Nigeria's economy is growing at an impressive rate compared to the historical. This reflects in part increased investor confidence due t o the improvement in macroeconomic management and positive dividends of the new found economic direction and general political stability. However, the renewed optimism is unlikely to be sustained if appreciable progress is not made to advance growth, general macroeconomic stability and poverty reduction. The reveals that, In order for growth to be poverty reducing, the link between economic development and labor market improvement must be strengthened significantly (or perhaps even re-established). In other words, the growth environment must be made more labor-friendly. In the short to medium term this would involve a necessary reduction in the tax wedge (payroll taxes) as well as an increase in the flexibility of the labor market. In the longer run, policies are needed that will close the mismatch of skills between labor demand and supply, which means promoting investment in human capital and education.

Author Bio

The author is a staff of World Bank, Abuja, Nigeria.

Publication Title

CBN Bullion







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