Business
Commercial banks urged to support businesses seeking expansion
The Central Bank of Nigeria (CBN) has urged commercial banks to leverage their presence in other parts of Africa to support Nigerian companies looking to establish their footprint in new markets.
CBN Governor Godwin Emefiele gave his advice at Zenith Bank’s 2021 export seminar on Tuesday in Lagos.
Emefiele called on commercial banks to support them by providing business facilities to those with high growth potential.
He said that the CBN had taken considerable steps to improve the production capacity of companies, which would allow them to take advantage of export opportunities in Africa.
“Our intervention programs in the agriculture and manufacturing sectors help to enable companies to expand their production scales, which responds to the growing domestic demand for goods, but also to supply goods for the market. export.
“In addition, we have set up a 500 billion naira non-oil export stimulus facility with the Nigerian Export Import Bank. This initiative will also help enable an increase in exports of processed agricultural products to other markets in Africa and to the world market, ”said Emefiele.
He said improving the business environment in Nigeria is also vital if we are to harness the gains of the African Continental Free Trade Agreement (AfCFTA).
He also said that the umbrella bank, through its Trade Monitoring System (TRMS) portal, is helping to reduce the time it takes to complete the export documentation process.
Emefiele said faster lead time could help reduce delivery times for goods for export and allow companies to increase production.
He said: “Today, companies can complete their NXP applications on the TRMS portal in 30 minutes compared to two years ago, where it can take up to two weeks to complete the process.”
The CBN governor said the umbrella bank was working with stakeholders to reposition the Nigerian commodity exchange to support greater trade for operators, especially in manufacturing, ICT, l agriculture and financial services.
He said that once the exchange becomes fully operational in the second half of the year, international buyers of raw and processed agricultural products will be able to enter into futures contracts with domestic suppliers on the exchange.
The governor of the CBN estimated that these futures contracts would help to support the improvement of the productivity of farmers and agro-processors.
Emefiele added that this would help improve access to credit for these entities by using forward contracts as collateral.
“Supporting greater trade in Africa will also require the presence of a viable payment settlement system,” he said.
Emefiele said in this regard that CBN is working with key stakeholders on the African continent, in particular Afrexim Bank, to improve the underlying payment infrastructure to support greater intra-regional trade, through the pan-African payment and settlement system.
He said the initiative would allow payments in our local currency for goods in other African countries and vice versa, without the need for a third currency.
Emefiele added that the initiative would help reduce the cost of trading across borders, improve convertibility of the naira and increase business opportunities for Nigerian businesses in Africa.
“The smuggling of goods produced in non-African countries to Nigeria and the abuse of rules of origin have often resulted in job losses and the displacement of important workers in key sectors of our economy such as agriculture and manufacturing industry.
“It is vital that we work with the AfCFTA governing body to address these concerns, as it has profound implications for unemployment and security in Nigeria,” he said.
He advised existing exporters to make efforts to repatriate their export products as required by law, stressing that exporters would have unhindered access to their export products.
The Nigerian News Agency (NAN) reports that the seminar was dedicated to expanding intra-regional trade and improving Nigeria’s non-oil exports.
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