CBN set to work with exporters for increased forex earnings

Cbn logoEncouraged by the increase of Nigeria’s foreign exchange(forex) reserves to $38.2 billion, the highest in 39 months, the Central Bank of Nigeria (CBN) has promised that it will join hands with the Nigeria Export and Import (NEXIM) Bank to support entrepreneurs who are willing to add value to existing raw materials for export.

This the bank said, will help the country to earn more forex from the non-oil sector of the Nigerian economy.

CBN Governor, Mr Godwin Emefiele revealed this on Friday at an export stakeholders meeting held at the bank’s head office in Lagos.

In its bid to help diversify the economy away from oil and boost the growth of the non-oil export sector, CBN in June 2016, launched the N500 billion non-oil Export Stimulation Fund (ESF).

According to the apex bank, the purpose of the fund is to  provide concessionary finance to non-oil exporters; provide long-term fund at single digit interest rates to non-oil exporters, aid non-oil export productivity and create more jobs.

Under the acronym PAVE, Produce, Add Value and Export, the governor disclosed that the existing framework for accessing the ESF will be updated and made more encompassing as well as easily accessible.

“Here, we are saying that with this meeting, the various sources of revenue into the country should not just be oil, neither should it just be foreign portfolio investors or FDI. We have seen some of the exporters bringing their monies into the country, but we are saying we want to encourage them with this N500 billion export stimulation facility, so that they can increase the volume of export earnings that is routed  back into the economy to help us grow the economy and service other forex obligations in the country,” the governor stated.

According to him, the framework about how this would work is going to be developed by NEXIM, the Development Finance Dept of the CBN and the Special Adviser, Agriculture at the Governor’s Office.

“We are also saying we are going to have the Anchor Borrowers’ Programme for exporters. For instance, we have so many cocoa farmers, primary rubber producers or palm oil producers who are in their villages or in their communities and we are saying that we are going to develop a framework that would make finance available to them through NEXIM and through the framework to be set up, where they can access some intervention funds,” he added.

Those export companies, the governor said, would act as their off takers and anchors. “For instance,” he further explained, “you have a farmer in the village or a couple of farmers that have a cooperative, what happens is that the cooperative would work with the cocoa exporters and the exporters would be the off-taker of the cocoa produce, but the funding would pass through the central bank to the banks or through NEXIM, and go through the exporters to the primary farmers.”

He explained that it is also part of the encouragement which the Federal Government is giving to the non-oil sector.

“All we are doing can not be about rice, tomato or maize, but we will go to other areas where there are cash crops like cocoa, rubber, to export, earn foreign exchange to lubricate and run our economy.”

Solid minerals is not excluded he added, as Nigeria has a lot of solid minerals and they are going to be covered under this programme.

“ I am comforted and I feel happy that the exporters came into the meeting, they told us their mind and we gave them our commitment to drive this process to success,” the CBN governor emphasized.