A new window of opportunities may have been opened up in the nation’s agriculture sector, with a pledge of ₦300 billion fresh financing of the economic segment and its value chains in 2016 by the Bankers’ Committee.
Besides, the earlier plans by the Central Bank of Nigeria (CBN) to create about one million jobs through small businesses’ development and support by lending at “ridiculously” lower interest rate to graduates got the nod of the committee.
The CBN Governor and Chairman of the Bankers Committee, Godwin Emefiele, said 2016 would see the financial industry raise support for Small and Medium Enterprises (SMEs) and increase further its contributions in the development of the nation’s agriculture sector to reduce importation and foreign exchange spending on food products.
The new ₦300 billion initiative would be a combination of CBN’s intervention and banks liquidity, which was recently boosted with the reduction in Cash Reserve Requirements from 25 per cent to 20 per cent.
He noted that previous of efforts of the Bankers Committee to spotlight opportunities and need to support agriculture in the country, resulted to improved lending by banks to manufacturing, power and aviation sectors, with notable shift from one per cent in 2010, to four in 2015 in agriculture.
He however, noted that there is need to de-risk the agriculture value chains to enable banks voluntarily open up their vaults in support of the sector’s development.
Already, CBN said it has collaborated with other government agencies, in training over 5000 farmers in simple record keeping and management of resources.
“The Committee feels there is need for monetary and fiscal authorities to work together in a collaborative manner to achieve the objective of improving local production of specific agricultural products like rice, tomatoes, beans, fish, sugar, among others,” he said.
Emefiele said the yearly retreat affords the bankers the opportunity to review performance for outgoing year, set agenda for the incoming year and share ideas with stakeholders and experts in targeted sectors.
“’Creating an enabling environment for SMEs’ growth’ as our theme for the 2015 retreat was aimed at raising support for government’s efforts in diversifying the economy in the face of the sharp drop in oil prices.
“SMEs are globally recognised as the catalyst for growth and development, even in developed economies, it has shielded them from the global crisis that remains unabating.
“There is also need to improve the level of infrastructure in various sectors- build more FADAMA road, provide more access to power, build more silos to preserve agricultural products right at the farm,” he said.
Continuing, Emefiele added: “We have a lot of work to do, not just as individual companies, but as group in the banking industry, to support the efforts of the government. To grow SMEs, increase the number of employment in the country, ensure that the youthful population are enabled to be young entrepreneurs that can provide jobs for others.
“The committee saw the need for a shift as SMEs are more of endangered sector, but BVN will assist in creating a pool of SME loans in the country. There is need to take the identified SMEs through capacity building and skills like record keeping and management.
“Power, transport and other infrastructure needs are strong enablers of growth in the economy. Banks will give all their support in financing these growth requirements.”