The Central Bank of Nigeria (CBN) and banks, under the aegis of the Bankers’ Committee, Thursday said they have resolved to commence the disbursement of single-digit loans to the creative industry, some targeted cash crops, as well as to intensify their support for other operators in the non-oil sector.
The amount to be disbursed to operators in these sectors was put at N200 billion.
This
is just as the committee reiterated that despite the concerns about the
recently held general election, the country recorded foreign portfolio
inflows (FPIs) of $6 billion in the first quarter of 2019.
The
Director, Banking Supervision Department, CBN, Mr. Ahmed Abdullahi,
said this Thursday at a media briefing at the end of the Bankers’
Committee meeting in Lagos.
Speaking on the increased FPIs
inflows, Abdullahi said: “The Bankers’ Committee noted that lending to
the private sector and the economy has increased and that is very
positive news. Also confidence by portfolio investors has also
increased. Between January and March despite the issue of the elections,
$6 billion came in and that is positive news.”
Also, the Group
Managing Director/Chief Executive of Access Bank, Herbert Wigwe, while
speaking to journalists, said the committee would commence disbursement
of funds for the creative industry.
According to him, the committee
revisited the entitle value chain of music, movies, information
technology and fashion, right from production facilities to capacity
building, to ensure that whatever is produced is world-class.
“At
the Bankers Committee, we got the approval to take it to the next
level, which is simply to do a final presentation and share it with the
market and how it’s going to happen. So by next week there will be
announcement for people who want to participate in each of these
segments.
“The specific amount will depend on which of the strata
you fall into and what you are doing. The loans are for a maximum of 10
years, they are single-digit interest rate loans and reflective of the
fact that in these industries, what you require is long term financing
at single-digit; while we will ask for collateral it will be flexible,”
Wigwe added.
On his part, the Managing Director of the United
Bank for Africa Plc (UBA), Mr. Kennedy Uzoka, who spoke on the
resolutions of the committee to enhance support for the real sector
said: “The committee believes that we really haven’t made so much
progress in this direction and subsequent to that, the committee set up a
sub-committee and the sub-committee of members are those who have
operated in continents where export have done very well. We have seen
some countries that have similar products and have excelled in exporting
while we have dropped.
“So, the question is, what are these
countries doing that we are not doing? What are those things that are
challenging us as a nation to diversify our economy from the standpoint
of exports?”
He further added: “We interrogated this and worked
with the different agencies of government across the continent and also
we came back home to check what they have and we found out that indeed
we have a lot of policies, but the challenge have been execution and we
narrowed this down to seven broad areas.
“Typically, finance is
one of the major challenges; we have policies, logistics -our ports
don’t open weekends- and in terms of the policies that drive exports, we
believe that a lot of them need to be changed.”
Alluding to the
fact that funding was a major challenge, he said the committee resolved
to focus on crops with near-term benefits.
He added:
“Fortunately, CBN has different types of funds, so we looked at the
existing funds so we don’t reinvent the wheel and so we looked at which
of the funding can address the current challenges. We looked at some
products with viability for export, and how it would help export,
address employment issues, create necessary economic activities and
create relieve in terms of foreign exchange.
“That is because if
we add value to a commodity, we would create employment and that would
save us foreign exchange, as against what we do today that most of our
products are exported in raw forms. And we believe that with a little
push, we can add a lot more value.”
He said the committee agreed
to immediately focus on oil palm, cocoa, sesame seed and of course shea
and cashew. “Based on the meeting we had today, we are going to be
lending at single-digit, up to a maximum of 10 years and we are going to
devote N200 billion to support this and that would change the narrative
for export.”
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