The Central Bank of Nigeria, CBN, has reiterated its commitment in stimulating Nigeria’s economic. Edward Lametek Adamu, deputy governor, corporate services, CBN, said the apex bank will achieve the economic development using three-pronged approach, centered on agriculture; Micro, Small and Medium Enterprises, MSMEs, and infrastructure.
Speaking at the 28th seminar for Finance Correspondents and Business Edtors, FICAN, Adamu said the CBN has transcended her core mandate of maintaining monetary, price and financial system stability, to undertaking developmental initiatives with a view to spurring economic growth and job creation.
“Our efforts at these development finance initiatives have helped to accelerate the actualization of the federal government’s economic diversification programme. Diversifying our economic base presents a more sustainable and stable option. Given the foregoing, it is our conviction that focusing our developmental efforts on sectors with inherent potential for growth, employment and accretion to foreign reserves would enhance the fortune of the Nigerian economy.
“As you are aware, the CBN increased its lending to the agricultural and manufacturing sectors, through targeted intervention schemes such as the Anchor Borrowers’ Programme, Commercial Agricultural Credit Scheme and the Real Sector Support Facility. In particular, we sought to improve domestic supply of four commodities (rice, fish, sugar, and wheat), which consume about N1.3 trillion annually in our nation’s import bill. The Anchor Borrowers’ Programme, ABP, which was launched in November 2015, was designed to build partnerships between small holder farmers and reliable large-scale agro-processors, with a view to increasing agricultural output, while improving access to credit for farmers.
“Our targeted focus on the agricultural and manufacturing sectors was driven by the vast opportunities for growth in these sectors given our high population. These sectors have the ability to absorb the growing pool of eligible workers in our effort to meet local demand and save critical foreign reserves,” he said.
Adamu said for many countries, the objectives of monetary policy are explicitly stated in the laws establishing the Central Bank, while for others, they are not. He noted that the objectives of monetary policy may vary from country to country.
“Our recent experience with recession attests to the value of effective implementation of monetary policy. Though we adopted unconventional or heterodox monetary policies, they were however, well thought through and have been yielding significant gains for the Nigerian economy.
“Noticeably the GDP recovery in the third quarter of 2017, which has been sustained for 9 successive quarters after 5 consecutive quarters of negative growth. This unconventional monetary policy initiatives have been premised on ensuring credit delivery to critical sectors of the economy. This has informed the directive to Deposit Money Banks to maintain a minimum Loan to Deposit Ratio, LDR, of 65 percent by the end of December 2019. The Bank is also creating the necessary eco-system to inculcate a better credit culture among Nigerians.”
According to adamu, there is sufficient evidence of significant reductions in our annual imports bill, and increased non-oil exports. He said development finance interventions have helped to bolster agricultural production by removing obstacles faced by small holder farmers.
“We have also improved access to markets for farmers by facilitating greater partnership with agro-processors and industrial firms in the sourcing of raw materials. So far, the programme has supported more than 1.5m farmers across all the 36 States of Nigeria, in cultivating 16 different commodities over 1.4 million hectares of farmland. It has also supported the creation of over 2.5m jobs across the agricultural value chain.
“Noticeable as these gains are, the media also has a critical role to play in conveying a deeper understanding of the Bank’s commitment to economic growth and development. For instance; it is our game changing intervention in the rice value chain in Kebbi and other rice-producing states across the country that increased local rice production from 2.5 million tonnes in 2015 to 5.8 million tonnes in 2017 as well as cotton intervention with the flag-off of input distribution to 150,000 cotton farmers, cultivating 150,000 hectares in 23 States of the Federation.
“Currently the cotton planted by these farmers has begun fruiting, while some are ready for harvest and off-take. We are currently also paying additional attention to cassava because the commodity has many different uses along the value chain. The value chain has enormous potential for employing over 2 million people in Nigeria.
“It is my belief that this seminar will facilitate robust interaction, leading to a deeper understanding of the theme for in-depth discussions. We hope that this seminar enriches your knowledge and that you become advocates of our interventions in enlightening the public and other stakeholders,” he said.