*Moves to boost local production, address challenges in commodity value chain
*Says eNaira will boost monetary policy transmission, others, caps transactions
*Cashless policy: Court rejects alleged discriminatory bank charges imposed by CBN
James Emejo, Sonia Mayomi in Abuja and Emmanuel Ugwu-Nwogo in Umuahia
The Central Bank of Nigeria (CBN) yesterday revealed that the importation of wheat costs the country about $2 billion annually, thereby exerting pressure on the country’s food import bill.
This is just as the CBN has stated that the much-awaited Central Bank Digital Currency (CBDC), known as the eNaira would improve monetary policy effectiveness and enhance government’s capacity to deploy targeted social interventions and boost remittances through formal channels.
Also, in what appears to be a setback for the country’s cashless policy, a Federal High Court in Awka, has said it was not proper for the CBN as a federal institution to adopt discriminatory policies in its operations.
Commenting on the country’s food import bill, the central bank stated that wheat was its second highest contributor with over five million Metric Tons (MT) imported yearly.
The apex bank however, restated its commitment to addressing the existing challenges in the wheat value chain as part of efforts to shore up the country’s foreign reserves.
This was made known by the CBN Director, Development Finance Department, Mr. Philip Yila Yusuf, at the Wheat Conference and Stakeholder Engagement, with the theme: “Improving and Sustaining the Wheat Value Chain Development in Nigeria,” in Abuja.
He noted that the wheat value chain had enormous potential for ground-breaking impact in the agricultural sector, adding that the central bank would focus attention on the commodity value chain for 2021/2022 dry season planting following the sustainable progress made across the rice and maize value chain.
The CBN director, further estimated that only one per cent or 63,000MT of wheat, out of the 5-6 MT consumed annually, was produced locally.
He said the CBN intervention had become critical due to the high demand for wheat in the country as well as the inability to meet that demand.
He said, “The CBN plans to address key problems in the value chain through financing massive production of wheat in Nigeria and seeks to facilitate sustained availability of high yield seed variety in country and improve general productivity.”
While admitting the enormous challenge before the bank, which would require concerted efforts to address, he assured stakeholders of the CBN’s readiness in changing the narrative in the sector by working with relevant industry players.
However, the Minister of Agriculture and Rural Development, Mohammed Abubakar, expressed dismay that the country’s wheat importation had continued to increase in recent years, urging stakeholders to collaborate to reverse by investing more in the value chain.
Also speaking at the occasion, Kano State Governor, Dr. Abdullahi Umar Ganduje, charged stakeholders in the wheat value chain to be transparent in their dealings and to commence preparation for both farming and production of wheat.
The governor commended the CBN for its efforts in boosting the commodity value chain and encouraged the bank to expedite action in releasing funds.
Represented by the Kano State Deputy Governor, Dr. Nasiru Yusuf Gawuna, Ganduje emphasised that partnership among stakeholders in wheat production value chains remained critical in boosting the country’s quest to be self-sufficient in the production of wheat.
Earlier in March, CBN Governor, Mr. Godwin Emefiele, had indicated that the bank remained committed to improving local production of wheat and reducing importation by 60 per cent over the next two years.
CBN: eNaira to Boost Monetary Policy Transmission, Others
On the eNaira, in its Regulatory Guidelines obtained by THISDAY, the apex bank said the initiative would improve monetary policy effectiveness and enhance government’s capacity to deploy targeted social interventions and boost remittances through formal channels.
The bank explained that that eNaira wallet was required to access, use and hold the digital currency.
The CBN also tasked the deposit money banks (DMBs) to facilitate prompt placement of restriction on eNaira wallets in the event of valid report of loss, theft of device or compromise, hack of a user eNaira wallet.
According to the Regulatory Guidelines on the eNaira, the apex bank further directed banks to ensure that customers are able to report via USSD channels, internet banking platforms, customer care phone lines, and in-branch customer care where there is any compromise in the eNaira transactions.
The CBN Governor, Mr. Godwin Emefiele, had said in unveiling the digital money, the bank does not downplay potential risks, adding however that the apex financial regulatory body had put in place appropriate mitigation mechanisms for safer operation.
He said, “We are not going to pretend that there are no risks in opening your system up. We will look at the various products, determine the risks, determine the best way to mitigate the risks before opening it up.
“But it is a journey that we are determined and decided that we will start on October 2021.”
The planned unveiling of the CBDC originally slated for October 1, 2021, was put on hold due to other key activities lined up to commemorate the country’s 61st independence anniversary.
However, the CBN, in the framework for the operation of the eNaira further set the transaction and balance limits for individual and merchant eNaira wallets.
In the Tier 0 category or phone number without verified National Identity Number (NIN), daily transaction is limited to N20,000 with balance or eWallet limit set at N120,000.
For the Tier 1 category with verified National Identity Number (NIN), daily transaction limit is set at N50,000 with N300,000 balance.
However, those in the Tier 2 category would be able to transaction up to N200,000 on a daily basis with eWallet balance of N500,000 while Tier 3 would have daily transactions of N1 million with balances of N5 million.
However, merchants, or duly accredited individuals and non-individual (corporates) authorised to conduct business in Nigeria will have no limits on eNaira transactions.
The CBN also stated that under the digital currency framework, Financial Institutions (FIs) shall render returns to the bank in line with the provisions of the Banks and Other Financial Institutions Act (BOFIA) 2020 and as may be specified from time to time.
The guidelines, among other things, said FIs shall put in place appropriate measures to ensure sound risk management practices to address potential threats to their operations.
These include an enterprise risk management framework; Appropriate governance structures,; Documented and approved policies; and Secured information technology infrastructure.
It said, “Financial Institutions shall be required to implement additional risk management measures as may be prescribed by CBN guidelines from time to time.”
The guidelines stipulated role and responsibilities of the different stakeholders particularly with respect to ensuring the prevention or minimisation of loss following loss, theft of a user’s device or compromise, hack of user eNaira wallet.
