Why non-oil exporters should get cheap credit

The high cost of accessing funds for non-oil export businesses remains a challenge that needed to be tackled to grow the economy, Director, Research and Development, Central Bank of Nigeria (CBN), Dr. Uwatt Uwatt has said.

Speaking at the ongoing seminar for finance correspondents in Abakaliki, Ebonyi State, he said there is need to reduce the cost of loanable funds to non-oil exporters as such would raise production volumes and boost the country’s foreign exchange earnings.

He explained that to check this trend, the apex bank canvassed for improved cheaper credits to everyone on the agric-value chain and also introduced the NIRAL scheme to de-risk agric lending.

He also said the N200 billion Commercial Agricultural Credit Scheme and N220 billion Micro, Small and Medium Enterprises (MSMEs) were also instituted to enable small businesses access cheap funds.

Uwatt who spoke on the theme: Overview of non-oil sector in Nigeria, said the drop in prices of crude oil in international markets has rekindled the need to revamp the non-oil sector. “Declines in global crude oil prices have triggered major headwinds for the economy. Continued dependence on oil poses a big threat to economic stability. The nation is now trying to retrace its steps from over dependence on oil for major part of its revenues,” he said.

The CBN director explained that the nation is now trying to retrace its steps from over dependence on crude oil which has not yielded positive results.

He said between 2011 and 2015, the contributions of oil sector to Gross Domestic Products (GDP) stood at 12 per cent while the federal allocations reports for August this year, showed that non-oil contributes 57.5 per cent to federally-collected revenues. He said government has adopted protectionism policies, trade libralisation, export promotion policy and privatisation to drive non-oil export.

Also speaking at the event, the CBN Governor, Godwin Emefiele noted the efforts of the apex bank transcends its core mandate of monetary and price stability, but involved developmental activities to stimulate growth.

According to him, the developmental initiatives become necessary given that the economy is a developing economy with inherent development challenges.

Source:   thenationonlineng.net/non-oil-exporters-get-cheap-credit-cbn/