February 14, (THEWILL) – Nigeria’s private sector coalition has put together N100 billion to help the government fight widespread insecurity in the country.
Chairman, UBA Group, Tony Elumelu, who made this known at the UBA Group Chairman’s Forum, at the weekend, said the private sector, more than ever, was committed to helping the government find solutions to the country’s myriad problems.
“We have just put N100 billion together, under the private-sector coalition to help fight insecurity or to support our security agencies’ capacities to be able to deal with the issues we are having in the country on security.
“We believe that if they are well-armed and protected, it will go a long way in helping to assure security in Nigeria,” Elumelu stated at the event.
At the onset of the Covid-19 pandemic, the private sector, under the Coalition Against COVID-19 (CACOVID), rallied around the government to find solutions to the devastating pandemic.
Elumelu said the private sector spent some N60 billion for this course and was ready to do more, saying the support provided covid tests kits, isolation centres across the states, vaccines, as well as palliatives for the less-privileged.
He told the gathering that the private sector coalition was engineered by the Governor of the Central Bank of Nigeria (CBN), Godwin Emefiele, whose vision, since assumption of office, had been to drive a people-focused central bank where decisions and policies would impact directly on the lives of the citizens.
His words: “It was during COVID that some Nigerians were able to know what the private sector could do under Governor Emefiele.
“We spent nothing less than N60 billion so far. And I think the most important thing was the strong move we made to open up the Nigerian economy.
“Then, post covid – not that COVID is completely over- we spent so much money for people to vaccinate; even supporting government agencies with money to enable them do so many things to keep Nigeria healthy and safe.”
The UBA Group Chairman’s Forum is a bi-annual interactive and knowledge-sharing event where all the board members, and Subsidiaries from the 20 African countries including, the United Kingdom and the US, gather to interact, learn, integrate and generate ideas to advance the African economy.
In his speech, Emefiele who was the special guest at the forum said his vision of a people-centred central bank was driven by some of the key challenges facing the Nigerian economy, particularly the heavy reliance on oil for revenues and foreign exchange earnings.
“The over-dependence on crude oil earnings fueled an excessive dependence on imports, which came at the expense of constraining growth in critical sectors of our economy such as agriculture and manufacturing. It also exposed our economy to volatilities associated with changes in the price of crude oil in global markets,” Emefiele stressed.
According to him, notwithstanding the relevance of the agriculture and manufacturing sectors, output has been constrained due to poor credit, relative to the oil and gas sector.
In a further effort to justify the CBN’s interventions in the real sector, Emefiele stressed that given a population size of over 200 million people, with favourable youth demographics, the apex bank was well convinced that providing the necessary support, including improved access to finance to households and businesses, coupled with better infrastructure would boost productivity, and help in enabling greater direct investment flows into the economy.
“As a result, there was a growing recognition of the need to refine our monetary policy tools and regulatory framework in order to ensure that it was more responsive to the needs of the Nigerian populace.
“It was important that this new framework enabled the flow of credit by financial institutions to critical sectors in order to aid our efforts at driving productive activities and creating job opportunities for our g to rowing population.
“More importantly, it was designed to curb an excessive penchant for imports particularly in areas where we possessed the manpower and resources to produce such goods in Nigeria.
“The CBN believes that investments in agriculture and related sectors, distribution storage systems, and necessary market infrastructure are critical to building a cost-effective, viable and sustainable food system in Africa.
“The creation of the appropriate policy initiatives to address the identified challenges is a charge we at the Central Bank of Nigeria have championed with some have results,” Emefiele reiterated.
The CBN, for instance, earmarked 1 trillion Naira, or $2.5bn to targeted initiatives in the manufacturing, mining and agriculture, services sectors.
Over 80% of this fund was targeted at the Agric sector. So far, the CBN has disbursed about USD 2 billion of this fund to over 3million farmers cultivating over 4.7 million hectares of arable land in the 36 states and the Federal Capital Territory (FCT), Abuja under the Nigerian Anchors Borrowers Programme (ABP).
Emefiele explained that all the initiatives were implemented in partnership with deposit money banks who serve to identify and appraise risks, as well as serve as a distribution mechanism for these interventions.
“As we all work together in supporting these critical sectors, it would mean more jobs and greater economic growth in our communities.
“It also ensures that not only do we continue to grow our economy, but that growth is broad-based and inclusive,” he said.
Emefiele, also explained that investments in agriculture and related sectors, distribution storage systems, and necessary market infrastructure are critical to build a cost-effective, viable and sustainable food system in Africa.
He said food security and job creation are fundamental building blocks in ensuring macro-economic stability, which is a cardinal mandate for central banks, adding that central banks and the financial system have critical roles to play in powering the solutions to the issues of food security and job creation on the African continent.
With an annual population growth rate of close to 2.8 percent, Emefiele said it was important that all efforts are concentrated at ensuring that employment opportunities were available for Nigerians particularly in sectors that has the ability to absorb key segments of the growing population.
Some of these sectors, according to him, are agriculture and manufacturing, which represented 10 and 27 per cent of Gross Domestic Product respectively.
Notwithstanding the relevance of these sectors, the apex bank boss said that sectoral credit allocation to them remained low relative to credit to the oil and gas sector, which stood at close to 29 per cent in 2014.
In contrast, he said that credit to the manufacturing and agricultural sectors stood at 10 per cent and three per cent respectively.
He said, “Given our population size of over 200 million people along with favourable youth demographics, we were aware that if the necessary support was provided to households and business such as improved access to finance, and better infrastructure these measures would boost productivity, and help in enabling greater direct investment flows into our economy.
“As a result, there was a growing recognition on the need to refine our monetary policy tools and regulatory framework in order to ensure that it was more responsive to the needs of the Nigerian populace.
“It was important that this new framework enabled the flow of credit by financial institutions to critical sectors in order to aid our efforts at driving productive activities and creating job opportunities for our growing population.
“More importantly, the design to curb an framework was excessive penchant for imports particularly in areas where we possessed the manpower and resources to produce such goods in Nigeria.”
The CBN governor explained that the creation of the appropriate policy initiatives to address the identified challenges is a charge the apex bank had championed with some results.
He said the bank had also deployed some development initiatives aimed at increasing food production, creating job opportunities and diversifying the economy.
According to him, over N1trn ($2.5bn) had been earmarked to target key initiatives in the manufacturing, mining and agriculture, services sectors.
He added that over 80 per cent of this fund was targeted at the agric sector.
Emiefiele said that the bank has disbursed about $2bn of this fund to over three million farmers cultivating over 4.7 million hectares of arable land in the 36 states and the Federal Capital Territory under the Nigerian Anchors Borrowers Programme.
In addition, credit to the manufacturing sector has risen from 10 per cent in 2014 to 16 percent in 2021 and in the agriculture sector, credit has grown from 3 per cent in 2013 to 6 per cent in 2022.
“We recently revamped the management of the Nigerian Commodities Exchange, as a reposition NCX will help enable farmers enter long term contracts with agro processors and exporters.
“This measure would ultimately increase the flow of funds to support expansion of agriculture and agro processing activities in the country, which will create jobs and wealth for our people.
“We are hopeful that over the next two years credit to the agricultural sector would rise to over 10 percent,” he added.
