THE Central Bank of Nigeria, CBN, Tuesday, said Nigeria’s economy is on recovery path but the growth is still fragile and below potential.
Consequently, while commending the banks for supporting the recovery efforts, the CBN Governor, Godwin Emefiele, charged them to initiate uncommon measures that would boost the recovery drive through credit to productive sectors.
Emefiele who spoke at the ongoing 2021 Annual Bankers’ Committee Retreat in Lagos, stressed that banks should make credit available to the Small Medium Enterprises, SMEs, which he described as the engine of growth.
He commended the banks for their support, cooperation and partnership with other key stakeholders in tackling the economic impact of the COVID-19 pandemic.
Speaking on the measures taken by the CBN to restore the economy to growth from recession and also tackle the COVID-19 pandemic, Emefiele stated: “With the creation of a N400 billion Targeted Credit Facility for households and small and medium enterprises, nearly N370 billion has been released to over 800,000 beneficiaries.
“On the back of this recovery, the CBN remains focused on strengthening the fundamentals of the Nigerian economy by using mostly innovative and sometimes extraordinary measures to diversify the economy, boost domestic productivity, and reduce our import dependence.
“Though the economy is recovering, growth remains fragile and below potential.
“Continued implementation of efforts to boost credit to productive sectors is required to sustain the recovery, quicken growth, and improve the livelihood of Nigerians.
“With population growth at about 2.7 percent annually, it is important that we continue to deploy measures that will enable our economy to attain faster and balanced growth rates of over 5 percent on an annual basis.”
Further on the efforts to sustain growth, Emefiele spoke about the apex bank’s new initiative it introduced known as 100-for-100 program.
He explained, “Under this programme, targeted credit of up to N5 billion will be provided to 100 firms every 100 days.
“Selected firms will be those investing in Greenfield projects, significantly able to create employment opportunities, and use local raw materials.
“The initiative will also support firms producing goods for the export market.”
Growth of the digital economy
In his comment on digital economy, the Emefiele said: “The CBN is focused on building a robust payment system in Nigeria which is cheap, fast, efficient, and safe.
“With the growing pace of digitization globally, we will continue to leverage digital channels in fulfilling this objective.
“Reflective of the confidence in our payment system, between 2015 and 2020, about $700 million has been invested in firms run by Nigerian founders.
“As the first central bank digital currency in Africa and one of the first in the world, the eNaira will foster greater financial inclusion using digital channels, support cross-border payments for businesses and firms, and provide a reliable channel for remittance inflows into the country.
“The eNaira will ensure that Nigerians in remote areas can conduct financial activities using their digital devices at little or no cost.”
Infrastructure Finance
Emefiele also spoke about the efforts of the apex bank in the area of infrastructure development in recnt times, saying, “With a seed capital of N1 trillion (about US$2.5 billion), the CBN, in partnership with the AFC (African Finance Corporation) and the NSIA (Nigerian Sovereign Investment Authority), set up the Infrastructure Corporation of Nigeria (InfraCorp) to raise over N15.1 trillion and support critical infrastructure investments.
“The Corporation will target strategic infrastructure projects to catalyse and strengthen growth.
“Infracorp is expected to set the standard template that will help in enabling greater private sector funding for public infrastructure projects in Nigeria,” he said.
International Financial Centre
He also disclosed plans by the CBN to float an international financial centre, saying, “The CBN is to mobilise international capital and support growth in key sectors, the CBN is establishing the NIFC.
“This will enable access to large pools of cheap investment capital.
“The NIFC will serve as a hub for attracting domestic and external capital to strengthen our post-covid economy and will help to position Nigeria as a key destination for investment in Africa.”
