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CBN, Bankers’ C’ttee Plan $200bn Income From Non-oil Export



The Central Bank of Nigeria (CBN) is set to stop supplying foreign exchange to banks as part of measures to prompt commercial banks into funding non-oil exports in the country.

The governor, CBN, Godwin Emefiele, while speaking at the end of February hybrid Bankers Committee meeting yesterday, Emefiele said, banks must join the race to earn non-oil foreign exchange. The CBN governor, while announcing the RT200, said, banks must generate export proceeds to meet the foreign exchange needs of their customers.

The CBN and the Bankers’ committee also  announced a new programme tagged: “RT200 FX Programme” designed to ensure that Nigeria generates $200 billion from non-oil export annually, as part of efforts to find homegrown solutions to the nation’s economic challenges.

Meanwhile, he said, the apex bank will commence an aggressive drive to boost non-oil foreign exchange earnings through the RT200 FX Programme.

The RT200 FX programme is a set of policies, plans and programmes for non-oil exports that will enable Nigeria attain lofty yet attainable goal of $200 billion in forex repatriation, exclusively from non-oil exports, over the next 3-5 years.

Addressing a media conference to announce outcome of the 364th meeting of Bankers’ committee in Abuja, Emefiele said the measure became important due to the fact that export of primary unprocessed commodities does not yield much in foreign exchange.

“We have told the banks today, that they must generate export proceeds. The CBN will not give out foreign exchange to banks again by the end of this year. Banks must join the race in earning forex to fund their customers’ needs” he stated.

“In order to avoid these sudden adjustments to our economic life, we need to focus on strategies that can help us earn more stable and sustainable inflows of foreign exchange,” Emefiele said at a media briefing in Abuja today.

The RT200 programme has five key anchors: value-adding exports facility, non-oil commodities expansion facility, non-oil fx rebate scheme, dedicated non-oil export terminal and biannual non-oil export summit.

The value-adding export facility is designed to provide concessionary and long-term funding for business people who are interested in expanding existing plants or building brand new ones for the sole purpose of adding significant value to our non-oil commodities before exporting same.

On the fears that the initiative could rob the local of supply with everyone looking at producing for export to earn higher return, Mr Emefiele said it would rather expand the market, create the needed jobs and stimulate economic activities.

The bank committee also announced non-oil commodities expansion facility. The facility is a concessionary facility designed to significantly boost local production of exportable commodities.

Emefiele said the facility will be designed to ensure that expanded and new factories that are financed by the value-adding facility are not starved of inputs of raw commodities in their production cycle.

Diaspora remittances hit $100m weekly

The CBN governor also disclosed yesterday that the bank’s policy on Naira4Dollar that was introduced last year has helped to boost remittances from only $6 million per week to over $100 million per week.

To take more advantage the initiative, CBN and the Bankers’ committee yesterday, announced the introduction of a non-oil fx rebate scheme, a special local currency rebate scheme for non-oil exporters of semi-finished and finished produce who show verifiable evidence of exports proceeds repatriation sold directly into the I & E window of the forex market to boost liquidity in the market. The rebate programme is with immediate effect.

The authorities are yet to establish the modalities for granting a rebate for each dollar that non-oil exports proceeds an exporter sells into the market for the benefit of other FX users and not for funding its own operations.

To save $14.2bn revenue loss through special export terminal

The Bankers’ committee also announced its readiness to partner state governments to build three dedicated non-oil export terminals to facilitate exportation of locally manufactured produce, saying it’s designed as a third anchor of the RT200 programme.

The committee said the move was in recognition of the perennial problems of port congestion cited by exporters as a major impediment to improved operations and foreign exchange earnings.

The aim is to secure the $14.2 billion which the African Centre for Supply Chain Practitioners say Nigeria loses annually due to congestion at its ports.

It costs $4,000 to move a container from Lagos port to mainland Lagos, a distance of about 12 kilometres due to congestion in the port.

CBN extends 5% interest rate on its facilities by 1 year

In another development, Emefiele announced the extension of the Central Bank’s interest on its credit facilities currently at 5 percent by another one year.

Although interest rates on its various intervention facilities were expected to revert to 9 percent effective March 1, 2022, CBN governor, Godwin Emefiele said the apex bank is announcing that the rates would remain at 5 per cent for another year in view of the promising trajectory it has established in economic growth and job creation.

“In effect, the concessionary interest rate of 5 percent on our intervention facilities would now be extended until March 1, 2023,” Emefiele said.

To date, Emefiele disclosed that the CBN, working with its deposit money banks (DMBs) and participating financial institutions has granted over N3 trillion in intervention loans that have been one of the critical ingredients for Nigeria’s economic recovery and employment generation.

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