The Central Bank of Nigeria (CBN) under the leadership of Chief Godwin Emefiele has become an activist and real interventionist institution that is consistently bringing in new and highly creative initiatives aimed at supporting and boosting Nigeria’s economic growth.
The latest novel initiative in development financing by the apex Bank is its proposal, which has made an appreciable progress, to collaborate with other local and extranational financial institutions to raise a N15 trillion fund over a five-year period for the financing of infrastructure in the country.
The CBN initiative on infrastructure development is in line with the policy thrust of the administration led by President Muhammadu Buhari to ensure that the country has adequate, evenly-spread, high grade infrastructure to support the growth of the Nigerian economy and the need of the country’s 200 million-strong population.
Given the much-praised ongoing and completed infrastructure projects in the country, and the funding required to create new railway lines, more power generation plants, additional sea and inland ports, the Infrastructure Company Plc has come at the time it is most needed to help the country minimize its infrastructure deficit. It will also create hundreds of thousands of new jobs and preserve existing ones, thus furthering the much-applauded ambition of the Muhammadu Buhari-led Federal Government to create 100 million jobs and drastically reduce poverty in the country.
An important point which analysts believe will make the Infrastructure Company Plc a viable venture is that its financial resources would be managed by an Independent Infrastructure Fund Manager (IIFM). This will insulate it from undue influence by powerful figures who have sabotaged laudable economic initiatives by squandering borrowed money on unearned lifestyles, thereby causing the collapse of otherwise viable initiatives.
The proposal to create the InfraCo Plc with a N15 trillion fund came on the heels of other interventions by the CBN, which Emefiele said were aimed at strengthening the Nigerian economy. The interventions include the provision of “a combined stimulus package of about N3.5 trillion in targeted measures to households, businesses, manufacturers and healthcare providers. These measures are deliberately designed to both support the Federal Government’s immediate fight against COVID-19, but also to build a more resilient, more self-reliant Nigerian economy.”
Other major historic interventions by the CBN are the Anchor Borrowers Schemes designed to enhance our self-sufficiency in the production of certain commodities. The nearly one dozen commodities include Rice, Palm Oil, Cotton, Yam and Tomato. It can equally be recalled that the CBN has reduced interest rates on intervention facilities from nine per cent to five per cent and created a N50 billion credit facility for households and SMEs affected by the covid-19 pandemic. It has also strengthened the Loan-Deposit Ratio regime, which is expected to encourage more lending to businesses by banks.
Given its roles and interventions in the fashion of an activist, trigger and stimulator of the Nigerian economy for sustainable growth, the CBN has earned a good reputation for itself and its current leadership. It should sustain those roles and the tempo of introducing new initiatives.
Salisu Na’inna Dambatta
rabotati002@gmail.com
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