â€¢ External reserves hit $47bn
As part of efforts to stimulate economic activities, the Central Bank of Nigeria (CBN) Governor, Mr. Godwin Emefiele has disclosed plan by the central bank, in collaboration with the banks to deploy part of the Agri-business, SME Investment Scheme Fund (AGSMEIS) fund to the â€œvulnerable sector in the next few days.â€
This is just as he put the present value of the countryâ€™s external reserves at $47 billion.
Emefiele said this in a keynote address he delivered after he received The Guardian â€œEconomic Personality of the Year 2017â€ award in Lagos yesterday.
He also disclosed that by the middle of this year, the AGSMEIS fund, which was derived from an initiative by the banks to set aside five per cent of their profit after tax year, would have risen to N60 billion. Emefiele explained: â€œIn 2016, the banks came up with an initiative where they all agreed that they would contribute five per cent of their profit after tax, to support the development initiatives of governments in Nigeria.
â€œBy the middle of this year, the banks would have contributed N60 billion into the fund. I can assure you all that in the next few days, the CBN together with the banks would be unfolding the disbursement to the vulnerable sectors in Nigeria.â€
Commenting on the central bankâ€™s interventions in real sectors of the economy in recent time, the CBN Governor disclosed that N393.5 billion had been released to 478 large scale agricultural projects since inception in 2010.
Furthermore, in terms of the Real Sector Support Facility (RSSF), he said the CBN was poised to disburse up to N400 billion at only nine per cent.
This strategic initiative, according to him, targets projects in manufacturing and agriculture, given the mutual interdependence of both sectors for the complete industrialisation of agro-allied business.
â€œThe CBN has also made efforts to finance agricultural value- chain activities through NIRSAL, which was established in 2011 and is now incorporated as a non-bank financial institution.
â€œUnder NIRSAL, more than 224 projects valued at over N33 billion were guaranteed for the Federal Ministry of Agricultureâ€™s Growth Enhancement Scheme.
â€œAlso, under the Anchor Borrowersâ€™ Programme (ABP), as we speak, domestic rice production has increased many folds and its imports have crashed substantially.
â€œWhile Kebbi State alone is expected to produce over two million metric tonnes of rice annually, employees at Labana Rice Mills are trying to keep pace with demand, processing 320 tons of rice a day, a 250 percent increase from the previous year.
As a result of this we have seen sharp drop in imports of rice from several countries,â€ he said.
Emefiele pointed out that the greatest challenge of the 17.3 million MSMEs in operation in the country presently remains poor access to affordable financing; leading to an estimated financing gap of about N9.6 trillion.
He noted the positive developments in the economy which has led to an improvement in most of the economic indicators.
â€œMost significantly we have seen a boost in Local Production. Due to our strategic development finance initiatives supported by the dogged implementation of our FX restriction on certain items, we have recorded spectacular improvements in domestic production of most of these items.
â€œAs a result, many local manufacturers are reporting major boosts to their revenue and profit.
â€œBut we must note that there remains much to be done. Nigeria remains significantly below its potential and I believe that a properly functioning financial system that channels credits to critical high impact productive real sector is a significant part of the reason.
â€œIt is imperative that we all realise that we have got a role play. There is the need for a well-coordinated and effective public private partnership if we must achieve the desired balanced economic growth and development on a sustainable and inclusive level,â€ he said.