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By Crusoe Osagie
The World Bank has said that for Nigeria to achieve its Financial System Strategy 2020, it must begin immediate action to achieve this feat.
Lead Economist, World Bank, Ismail Radwan, said that Nigeria must use 2011 as a start off point to achieve FSS 2020
Radwan, who spoke during a book launch titled ‘Achieving Nigeria’s Financial System Strategy 2020’, said there is the need to improve access to finance and the great potential to develop Nigeria’s dormant insurance industry by strengthening re-insurance, improving transparency, updating the legal framework and cracking down on fake insurance companies.
He said that according to a report ‘Making Finance Work for Nigeria’ that accumulating assets could be used to finance long term liabilities such as infrastructure or housing finance. “This can be achieved through the creation of a liquidity facility that could act as a bridge between the primary mortgage institutions and the corporate bond market,” the report said.
He said in 2006, and within the rubric of vision 2020, the CBN outlined a bold strategy for improving Nigeria’s financial sector, the Financial System Strategy 2020 (FSS2020).
“Although FSS2020 was an entirely home-grown initiative, the CBN invited the World Bank to support its efforts to improve the financial sector and to help diagnose the major challenges,” he said.
“Led by the Nigerian authorities, the experts provided suggestions for improvements in the banking sector, rural finance, SME finance, capital markets, housing finance, insurance, pensions and infrastructure finance among other areas,” he added.
According to him this book is a compendium and summary of the analysis of the Nigerian financial sector, produced through this process. He said in each area the book provides a detailed implementation plan that reflects a consensus of key stakeholder views and international best practice.
Meanwhile, the World Bank Country Director in Nigeria, Mr. Onno Ruhl, said Nigeria deserves to be one of the top 20 economies in the world by 2020, adding that the report provides a roadmap towards achieving it.
Ruhl said the analysis undertaken in some cases has already led to quick wins for Nigeria, saying that a recommendation to remove the monopoly enjoyed in remittances to Nigeria led to a dramatic reduction in fee rates from 8 per cent to 5 per cent.
He said it is estimated that this move alone has put an additional $60 million into the hands of ordinary Nigerians instead of the money transfer companies. Further gains are possible.