The Central Bank of Nigeria (CBN) has urged commercial banks to leverage their presence in other parts of Africa to support Nigerian businesses seeking to plant their footprints into new markets.
The CBN Governor, Mr Godwin Emefiele, gave the advice at the Zenith Bank’s 2021 Export Seminar on Tuesday in Lagos.
Emefiele called on the commercial banks to support them by providing trade facilities to those with strong potential for growth.
He said that the CBN had taken considerable steps to improve the productive capacity of businesses, which would enable them take advantage of export opportunities in Africa.
“Our intervention programmes in the agriculture and manufacturing sectors, are helping to enable businesses expand their scales of production, which is meeting growing domestic demand for goods, but also providing goods for the export market.
“In addition, we have set up a N500 billion non-oil export stimulation facility with the Nigerian Export Import Bank. This initiative will also help to enable greater exports of processed agriculture commodities into other markets in Africa and in the global market,” Emefiele said.
According to him, improving the business environment in Nigeria is also vital if we are to harness the gains from the Africa Continental Free Trade Agreement (AfCFTA).
He also said the apex bank through its Trade Monitoring System (TRMS) portal was helping to reduce the time it would take to complete the export documentation process.
Emefiele said that faster turnaround time could help to reduce delivery time for goods destined for exports and enable businesses expand their output.
He said: “Today, businesses can complete their NXP applications on the TRMS portal in 30 minutes relative to two years ago, where it can take as much as two weeks to complete the process.”
The CBN governor said the apex bank was working with stakeholders to reposition the Nigerian Commodity Exchange to support greater trade for operators particularly in the area of manufacturing, ICT, agriculture and financial services.
He said that once the exchange become fully operational in the second half of the year, international buyers of raw and processed agricultural commodities would be able to enter into forward contracts with domestic suppliers on the exchange.
The CBN governor believed that these forward contracts would help to support improved productivity for farmers and agro-processors.
Emefiele added that it would help to improve access to credit for these entities using the forward contracts as collateral.
“Supporting greater trade within Africa will also require the presence of a viable payment settlement system,” he said.
Emefiele said in this regard, that the CBN was working with key stakeholders in the African continent, particularly the Afrexim Bank to improve the underlying payment infrastructure to support greater intra-regional trade, through the Pan African Payments and Settlement System.
He said the initiative would enable payments in our local currency for goods in other African countries and vice versa, without the need for a third-party currency.
Emefiele added that the initiative would help to reduce the cost of cross border trade, improve convertibility of the naira and increase trade opportunities for Nigerian businesses in Africa.
“Smuggling of goods produced in non-African countries into Nigeria and abuse of rules of origin have often resulted in significant job losses and displacements of workers in key sectors of our economy such as agriculture and manufacturing.
“It is vital that we work with the governing body of the AfCFTA in addressing these concerns, as it has profound implications on unemployment and security in Nigeria, “he said.
He advised existing exporters to endeavour to repatriate their export proceeds as required by the law, stressing that exporters would have unfettered access to their export proceeds.