…invests more in non-oil products
BY ODILI CHRISTEL
Central Bank of Nigeria has said that its core mandate of maintaining monetary and price stability
covers both developmental activities especially in financial intermediation and resource allocation to stimulate the development of key sectors that are drivers of growth in the economy.
The Governor, Central Bank of Nigeria, Mr. Godwin Emefiele, who was represented by the deputy Governor of Corporate Services, Mr. Adebayo Adelabu made this known in Ibadan, Oyo state on Monday during the opening Ceremony of the 21st Seminar for Finance Correspondents and Business Editors, with the theme ” CBN Real Sector Financing: A Catalyst for Economic Growth and development.
While giving his address he noted that the seminar and it’s theme is coming at a crucial period when the price of crude oil has witnessed a drop of over 70% , thereby affecting accruals into foreign reserves.
According to him, ” the real sector, as you know, is the engine of every economy as it facilitates the production of raw materials, which add value to the domestic economy and consequently serves as a source of wealth creation and income generation to the productive population”.
He noted that the real sector which consists of agricultural, industrial, building and construction sub-sectors accounted for 83.67 of the country’s Gross Domestic Product in 2000. “the sector’s contribution however, witnessed a decline to 76.21% in 2010 and further down to 70.71% in 2013. The rebasing of the economy further delineated the real sector into a variety of sub-sectors with agriculture, mining and quarrying activities, manufacturing and construction jointly contributing about 43.2% to the total GDP as at 2014”.
Emefiele reiterated that the objectives of CBN in implementing schemes and programmes for real sector development focuses on the inherent potential in the sector, nothing that the sector has sufficient employment capabilities, high growth potentials, contributes in foreign reserves stating that the CBN desire to stimulate credit injection into the real sector does not attempt to “Crowd out” the financial institutions in the space of credit delivery but to provide incentives that will stimulate lending at reasonable rates by banks to the real sector.
He noted that the CBN approach to real sector development is three-pronged. Our interventions centre around Agriculture, MSMEs and infrastructure intervention, specifically, the intervention include the 300 billion naira Real Sector Support Facility (RSSF), the 220billion naira Micro, Small and Medium Enterprises Development Fund (MSMEDF), the Small and Medium Enterprises Refinancing and Restructuring Facility( SMERRF), the 75billion naira Nigeria Incentive Based Risk Sharing System for Agricultural Lending (NIRSAL) and the 213billion naira Nigeria Electricity Market Stabilization Fund amongst others.
“let me also note that the reduction in the Cash Reserve Requirement (CRR) of Deposit Money Banks from 25% to 20% has freed up enormous resources that the banks can leverage on to finance projects under the Real Sector Support Fund. Also, the bank is committed to stimulating accretion of foreign exchange through non\oil exports. The bank is supporting NEXIM with 50billion naira Export Refinancing and Restructuring Facility and also 500billion naira as Non-oil Export Stimulation facility(ESF)”.
He urged the media to play their respective roles to ensure that the country’s economy remains strong and also encourage the CBN to achieve its set objectives of ensuring strong economy and sound financial system.
Speaking earlier, the Deputy Governor, Corporate Services, CBN, while giving his address noted that the seminar aims at fostering a good and healthy working relationship between the bank and the media so as to correctly interpret and report on contemporary economic and financial issues as well as CBN policies and initiatives.
Mr. Adelabu noted that the theme of the seminar is to educate participants into the core principle behind the actions of the CBN to act a financial catalyst in targeting sectors of the economy with humongous potentials foe creating jobs and reducing the country’s import bills in a very significant manner.
He thanked the Nigerian media for supporting the policies of the CBN on in the face of extreme local and international pressures from vested interests. ” A whole lot could go wrong when people do not have access to the right pieces of information, particularly about the economy”.
“we re optimistic that this forum would serve as an ideal platform to stimulate and reinforce national discussions on all issues” he said.