Emefiele: Macroeconomic Environment Needed for Sustainable Growth

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By Ndubuisi Francis in Abuja

The Governor of the Central Bank of Nigeria (CBN), Mr. Godwin Emefiele, has stated that financing was not the magic wand but a conducive macro-economic environment was required to provide  support for the economy to achieve sustainable growth and development.

He stated that investment in science, technology and innovation (STI) holds the key to economic progress and development.

According to him,  development globally is largely driven by the ability to develop, distribute and exploit intelligence to achieve competitive edge, create wealth and improve on the welfare of the citizenry.

Emefiele spoke  during a lecture titled: ‘Financing Science, Technology and Innovation (STI) for the Development of Agro-Allied Industries in Nigeria,’ delivered to the participants of Senior Executive Course 39 at the National Institute of Policy and Strategic Studies (NIPSS) Kuru, Jos, Plateau State.

The CBN governor  who was represented by the bank’s Deputy Governor in charge of Corporate Services, Alhaji Suleiman Barau, said development worldwide is largely driven by the ability to develop, distribute and exploit intelligence to achieve competitive edge, create wealth and improve on the welfare of citizenry.

Breakthroughs in STI, particularly in information and communication technology (ICT), he said, had brought technology to the reach of an overwhelming number of the global population, increasing their frontiers to explore and even expand innovations further into limitless opportunities.

He noted that myriad of challenges hinder the financing of STI or in deed entire agricultural value chain, listing the challenges to include access to finance, cost of borrowing and absence of alternative known traditional sources for funding.

Emefiele added that financing of STI in Nigeria has had to largely depend on incentives, direct loans, budgetary provisions and support from international donor agencies.

According to him, records show that budgetary allocation to the Ministry of Science and Technology for 2015, 2016 and 2017 as a percentage of total was abysmal 0.66 per cent, 0.87  per cent and 0.93 per cent of total budgetary provision respectively.

This is far too low to achieve the drive towards harnessing STI to develop agro-allied industries as well as other sectors, he said.

Emefiele disclosed that it was the realisation  of these gaps that pushed the CBN into playing a major role under its intervention schemes to provide funding at a single digit interest rate to agriculture and inclusive agro-industrial industries.

He listed these intervention schemes to include the Nigeria Incentive-based Risk Sharing System for Agricultural Lending (NISRAL), the Agricultural Credit Guarantee Scheme (ACGS), the Commercial Agricultural Credit Scheme(CACS), the Small and Medium Scale Enterprises Refinancing and Restructuring facility (SMERRF), the Anchor Borrowers’ Programme (ABP) and Youth Entrepreneurship Development Programme (YEDP).

The CBN governor noted that if Nigeria was to achieve its goal of food sufficiency and a diversified economy, more attention must be paid to implementing financing for agro-allied industries by the government.

He called for deliberate policies capable of  encouraging non-government investors and enhancement of the financing framework in the context of access and low interest rate for the commercially attractive STI and agro- allied businesses that would require both tactical and strategic solutions.

Emefiele however said  financing was not the magic wand but a conducive macro-economic environment required to provide the support for the economy to achieve sustainable growth and development.