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The Central Bank of Nigeria (CBN) in collaboration with the deposit money banks are planing to disburse N60 billion from the Agri-business, SME Investment Scheme Fund (AGSMEIS) fund to the vulnerable sector of the economy in the next few days.
AGSMEIS fund is an initiative by the banks as directed by the CBN to set aside five per cent of their profit after tax yearly. The fund is expected to have grown to N60 billion by the end of the year.
Godwin Emefiele, governor of CBN, disclosed this at the weekend in Lagos while delivering an keynote address at the Guardian “Economic Personality of the Year 2017” award.
He noted that the level of credit in the domestic economy channelled to productive private sector is critically below the levels required to place the economy on the path of balanced, sustainable, and inclusive growths.
Emefiele said the sum of ₦393.5 billion had been released to 478 large scale agricultural projects since inception in 2010, even as the Bank was poised to disburse up to ₦400 billion at only 9.0 percent interest rate under the Real Sector Support Facility (RSSF), adding that the strategic initiative was targeted at projects in manufacturing and agriculture, given the mutual interdependence of both sectors for the complete industrialization of agro-allied business.
He also disclosed that under the Nigeria Incentive-based Risk Sharing System for Agricultural Lending (NIRSAL), established in 2011, more than 224 projects valued at over ₦33.0 billion were guaranteed for the Federal Ministry of Agriculture’s Growth Enhancement Scheme.
Under the Anchor Borrowers’ Programme (ABP), he reported that the domestic rice production had increased many folds and its imports had crashed substantially.
While also enumerating the Bank’s intervention efforts in the power sector, which he noted was key to industrialization, as well as the Micro, Small and Medium-Scale Enterprises (MSMEs), which he said was the nucleus of sustainable growth, job creation and poverty reduction, he said the intervention of the CBN in key sectors had resulted in a significant boost in local production.
Emefiele said that as a result of the Bank’s strategic development finance initiatives supported by the dogged implementation of its foreign exchange restriction on certain items, Nigeria had recorded spectacular improvements in domestic production of most items that were hitherto imported.
In spite of the gains recorded by the Bank, he said Nigeria remained significantly below its potential and must ensure that it sustains a properly functioning financial system that channels credits to critical high impact productive real sector.
While noting that a lot still needed to be done if Nigeria must achieve the desired balanced economic growth and development on a sustainable and inclusive level, he stressed the need for a well-coordinated and effective public private partnership to enable Nigeria achieve its potentials.
Hope Moses-Ashike
