In a bid to improve production and exports of cash crops in Nigeria, the Bankers Committee has earmarked a credit facility of N200 billion. The disclosure was made by the Managing Directors of UBA Plc and GTBank Plc, Kennedy Uzoka and Segun Agbaje respectively, during a press conference after a meeting.
The credit will be extended as loans to companies producing any of the selected five cash crops – Cocoa, Oil Palm, Shea Butter, Sesame Seed and Cashew – at single digit interest and for a tenor period of ten years.
“As you know we have always talked about Nigeria been a mono economy, oil only, and many seminars have happened with so many resolutions. But the committee believes we have not made much progress in this direction hence that was the theme of the retreat,” Uzoka said.
The UBA chief also noted that several CBN funds and existing funding structures were considered to avoid reinventing the wheel, and see which of the funds could address the current challenges. Consequently, the committee is applying the existing fund that was identified in CBN.
Speaking on what led to the decision to set up the fund, Director of Banking Supervision Department, Central Bank of Nigeria (CBN), Ahmed Abdullahi said that the Committee noted the stability in the economy and improved foreign investors confidence in the nation’s economy.
The improvement is reflected in the $6 billion foreign portfolio investment (FPI) inflow in the first quarter of this year. Thus, the Committee decided to focus on initiatives that will consolidate the pro-growth stance of the CBN, through the recent reduction of the Monetary Policy Rate (MPR) from 14 percent to 13.5 percent.
“And in terms of the policies that drive exports, we believe that a lot of them have to be changed. And we know about the congestion at the port. So we looked at all these things and we broke them into immediate, medium and long term because some we cannot address within a short period,” Uzoka added.
In recent times, CBN has been making efforts to develop several sectors including the cotton, textile and garment, as well as in palm produce. More so, the Committee revealed that it would soon announce a credit facility to support the creative industry with the aim of creating 300,000 jobs in the industry.