Post by Trade facilitator on Feb 4, 2012 17:37:40 GMT 1
How is the Nigeria Export-Import Bank contributing to the Goodluck Jonathan Administration’s effort to revamp the nation’s comatose industrial (manufacturing) sector?
NEXIM’s contribution is in the area of providing finance and guarantees to enhance industrial capacities and capacity utilisation, as well as supporting the acquisition and adoption of new and clean technologies, thereby ensuring competitiveness of Nigerian products and manufacturing operations.
Under the Obasanjo administration, NEXIM provided funding windows of N500 million each for the export of sesame seeds and cassava. What has happened to these facilities? What basically has NEXIM been able to achieve in the agricultural sector?
NEXIM doubled its funding intervention to the sesame seeds and cassava initiative during the period. The sum of N1.2 billion was disbursed to 17 participating banks and beneficiary projects under the sesame programme, mainly for merchant exports with no value addition. On the cassava initiative, the bank provided about N1.1bn to five companies for value added processing of cassava to flour, chips and glucose syrup. It is gladdening to note that some of the projects are doing well with take-off arrangements with multinational companies, thereby conserving about $5mn in foreign exchange annually in inputs that would otherwise have been imported. The banks’ current exposure to the agricultural sector is approximately 39 per cent of the NEXIM’s total existing funding intervention.
In the last four years, how much of non-oil export trade has NEXIM facilitated in terms of volume and value? And what are your projections for the next five years?
In the last four years (2007-2010), NEXIM has supported the Nigerian non-oil export to the tune of N20.04bn. As regards our funding intervention in the next five years, our strategic plan projection is to support the non-oil export sector to the following minimum level as follows: 2011 – N37bn; 2012 – N41bn; 2013 – N50bn; 2014 – N63bn and 2015 – N94bn.
What role is NEXIM playing to boost the economy generally?
The Nigeria Export-Import Bank’s role is essentially in funding intervention in sectors with high employment generation potentials like the manufacturing sector and attraction of competitive investment capital in trade facilitation, in line with its strategic blueprint. The blueprint presents NEXIM’s strategic intent/direction for the next five years (2010-2015).
You just returned from the 2011 World Economic Forum on Africa in Cape Town, South Africa. What do you see as NEXIM’s role in charting Africa’s leadership role into the future?
NEXIM’s participation at the WEF was the first time the bank was attending the event. Its role in charting Africa’s leadership in trade is essentially in becoming the largest facilitator of trade in Africa with intra-regional trade levels of Nigeria’s non-oil exports and total African exports attaining a minimum of 15 per cent and 25 per cent of total Nigerian exports from the current levels of 10 per cent and 15 per cent respectively.
What has been NEXIM’s greatest challenge in its 20 years of existence?
The greatest challenge is the paucity of operational funds to deepen funding intervention in the non-oil sector. I am glad that we are getting there with the support of our stakeholders and strategic funding partners.
How is NEXIM boosting the competitive edge it has over fellow specialised banks?
NEXIM’s activities are essentially complementary to the activities of all the institutions in the financial sector. However, to remain relevant and to facilitate the bank’s role meaningfully, it is strengthening its processes, enterprise-wide risk framework and corporate governance structure, among other key performance-related functions and structures.
Recently, the bank was at the Ministry of Health to contribute to the take-off of XECHEM Pharmaceutical Company. Why is the bank involved in Mr. President’s commitment to promoting laudable healthcare schemes for Nigerians?
The Minister of Health inaugurated the interim management committee to be chaired by me with the following clear terms of reference: to ensure the immediate resuscitation of the production of NIPRISAN at the Sheda Production Facility on social basis; to put in place an appropriate and workable structure for the resuscitation; to provide guidelines for operation of the project through appropriate structure; to monitor activities and the progress of the appropriate project implementation structure; to evaluate and submit progress on monthly basis to the Office of the Honourable Minister of State for Health; and to take any other measures that could lead to the achievement of sustained production of NIPRISAN. Since inauguration, the Committee have met severally and have visited the Sheda factory site to discuss with the authorities and staff on the impending recommencement of production.
How does NEXIM score itself in the provision of export credit and insurance guarantees as a platform for boosting non-oil exports?
Moderate, with all humility. Our beneficiary clients and stakeholders will be in a better position to score our performance over the years. It should be noted that the bank has since inception provided over N63bn and $280mn in funding intervention to over 400 beneficiaries. Also, it has provided non-funded risk-bearing facilities of over $36mn and €11mn. With regards to industrial capacity installed, the bank has intervened in the creation of over 50,000 tonnes of additional cocoa processing capacities, 30,000 tonnes of rubber processing capacities and the facilitation of the acquisition of over 60 industrial fishing/shrimping trawlers.
For a long time, NEXIM has been bedevilled by non-performing loans. How has it been able to recover such loans?
The non-performing loan, NPL, issue became more apparent from 2008, which coincided with the global economic recession. This is as a result of the fact that its major clients’ operations were within the external sector of the economy, with the country’s export destinations being largely Europe and America. It is not surprising that the export companies were affected, hence their inability to honour maturing obligations that have had to be classified in line with prudential regulations. To curtail a recurrence of the incidence of high non-performing loans and ensure recovery, the bank has strengthened its risk management operations and also set up a Remedial Management Department.
The bank has hired a Chief Risk Officer. Does his engagement guarantee a non-recurrence of NPLs?
Yes, a Chief Risk Officer has been engaged. This is to ensure that the bank’s operations are in line with regulatory expectations and best practices. The CRO, along with other members of his team, is expected to strengthen the bank’s risk operations. The reduction in high NPLs is a collective effort backed by sound structures, policies, processes and institutional framework that are well-implemented.
What has NEXIM done to support the President’s vision on employment creation?
The bank’s funding intervention in support of exports has created and sustained a total of 6,000 jobs in the past two years – 2,500 jobs in 2009 and 3,500 jobs in 2010. Its support translates to additional developmental impact by way of foreign exchange generation to the tune of an average of $100mn annually, which makes it a total of $200mn in the past two years. In 2011, the bank is positioned to create and sustain over 15,000 direct jobs and generate an estimated forex of $300mn. This is because funding intervention would be targeted at sectors with high employment potentials like agriculture, mining, tourism and the entertainment and creative art industry.
When would the ECOWAS sea-link start and who would be the owners of the company?
As you know, the ECOWAS sea link project is an initiative of the NEXIM Bank and the organised private sector. It is targeted at facilitating intra-regional trade within the ECOWAS sub-region and even extending to Central Africa. It aims to not only deepen trade within ECOWAS but to also reduce cost and time of movement of goods, services and people within the sub-region in line with the core charter of the ECOWAS. Though a definite date has not been fixed for the vessels to start operating, the bank has since commenced the promotional arrangements to set up appropriate structures and arrangements in that regard. For now, NEXIM and some key developmental partners along with the ECOWAS chambers of Commerce will drive the establishment of the project to ensure it starts on a sound and efficient footing. Eventually, the initiative would be arranged in such a way that it will be owned by the private sector players within the region and listed in different stock exchanges.
Source: thenewsafrica.com/2011/06/13/nigeria-must-expand-non-oil-export/
NEXIM’s contribution is in the area of providing finance and guarantees to enhance industrial capacities and capacity utilisation, as well as supporting the acquisition and adoption of new and clean technologies, thereby ensuring competitiveness of Nigerian products and manufacturing operations.
Under the Obasanjo administration, NEXIM provided funding windows of N500 million each for the export of sesame seeds and cassava. What has happened to these facilities? What basically has NEXIM been able to achieve in the agricultural sector?
NEXIM doubled its funding intervention to the sesame seeds and cassava initiative during the period. The sum of N1.2 billion was disbursed to 17 participating banks and beneficiary projects under the sesame programme, mainly for merchant exports with no value addition. On the cassava initiative, the bank provided about N1.1bn to five companies for value added processing of cassava to flour, chips and glucose syrup. It is gladdening to note that some of the projects are doing well with take-off arrangements with multinational companies, thereby conserving about $5mn in foreign exchange annually in inputs that would otherwise have been imported. The banks’ current exposure to the agricultural sector is approximately 39 per cent of the NEXIM’s total existing funding intervention.
In the last four years, how much of non-oil export trade has NEXIM facilitated in terms of volume and value? And what are your projections for the next five years?
In the last four years (2007-2010), NEXIM has supported the Nigerian non-oil export to the tune of N20.04bn. As regards our funding intervention in the next five years, our strategic plan projection is to support the non-oil export sector to the following minimum level as follows: 2011 – N37bn; 2012 – N41bn; 2013 – N50bn; 2014 – N63bn and 2015 – N94bn.
What role is NEXIM playing to boost the economy generally?
The Nigeria Export-Import Bank’s role is essentially in funding intervention in sectors with high employment generation potentials like the manufacturing sector and attraction of competitive investment capital in trade facilitation, in line with its strategic blueprint. The blueprint presents NEXIM’s strategic intent/direction for the next five years (2010-2015).
You just returned from the 2011 World Economic Forum on Africa in Cape Town, South Africa. What do you see as NEXIM’s role in charting Africa’s leadership role into the future?
NEXIM’s participation at the WEF was the first time the bank was attending the event. Its role in charting Africa’s leadership in trade is essentially in becoming the largest facilitator of trade in Africa with intra-regional trade levels of Nigeria’s non-oil exports and total African exports attaining a minimum of 15 per cent and 25 per cent of total Nigerian exports from the current levels of 10 per cent and 15 per cent respectively.
What has been NEXIM’s greatest challenge in its 20 years of existence?
The greatest challenge is the paucity of operational funds to deepen funding intervention in the non-oil sector. I am glad that we are getting there with the support of our stakeholders and strategic funding partners.
How is NEXIM boosting the competitive edge it has over fellow specialised banks?
NEXIM’s activities are essentially complementary to the activities of all the institutions in the financial sector. However, to remain relevant and to facilitate the bank’s role meaningfully, it is strengthening its processes, enterprise-wide risk framework and corporate governance structure, among other key performance-related functions and structures.
Recently, the bank was at the Ministry of Health to contribute to the take-off of XECHEM Pharmaceutical Company. Why is the bank involved in Mr. President’s commitment to promoting laudable healthcare schemes for Nigerians?
The Minister of Health inaugurated the interim management committee to be chaired by me with the following clear terms of reference: to ensure the immediate resuscitation of the production of NIPRISAN at the Sheda Production Facility on social basis; to put in place an appropriate and workable structure for the resuscitation; to provide guidelines for operation of the project through appropriate structure; to monitor activities and the progress of the appropriate project implementation structure; to evaluate and submit progress on monthly basis to the Office of the Honourable Minister of State for Health; and to take any other measures that could lead to the achievement of sustained production of NIPRISAN. Since inauguration, the Committee have met severally and have visited the Sheda factory site to discuss with the authorities and staff on the impending recommencement of production.
How does NEXIM score itself in the provision of export credit and insurance guarantees as a platform for boosting non-oil exports?
Moderate, with all humility. Our beneficiary clients and stakeholders will be in a better position to score our performance over the years. It should be noted that the bank has since inception provided over N63bn and $280mn in funding intervention to over 400 beneficiaries. Also, it has provided non-funded risk-bearing facilities of over $36mn and €11mn. With regards to industrial capacity installed, the bank has intervened in the creation of over 50,000 tonnes of additional cocoa processing capacities, 30,000 tonnes of rubber processing capacities and the facilitation of the acquisition of over 60 industrial fishing/shrimping trawlers.
For a long time, NEXIM has been bedevilled by non-performing loans. How has it been able to recover such loans?
The non-performing loan, NPL, issue became more apparent from 2008, which coincided with the global economic recession. This is as a result of the fact that its major clients’ operations were within the external sector of the economy, with the country’s export destinations being largely Europe and America. It is not surprising that the export companies were affected, hence their inability to honour maturing obligations that have had to be classified in line with prudential regulations. To curtail a recurrence of the incidence of high non-performing loans and ensure recovery, the bank has strengthened its risk management operations and also set up a Remedial Management Department.
The bank has hired a Chief Risk Officer. Does his engagement guarantee a non-recurrence of NPLs?
Yes, a Chief Risk Officer has been engaged. This is to ensure that the bank’s operations are in line with regulatory expectations and best practices. The CRO, along with other members of his team, is expected to strengthen the bank’s risk operations. The reduction in high NPLs is a collective effort backed by sound structures, policies, processes and institutional framework that are well-implemented.
What has NEXIM done to support the President’s vision on employment creation?
The bank’s funding intervention in support of exports has created and sustained a total of 6,000 jobs in the past two years – 2,500 jobs in 2009 and 3,500 jobs in 2010. Its support translates to additional developmental impact by way of foreign exchange generation to the tune of an average of $100mn annually, which makes it a total of $200mn in the past two years. In 2011, the bank is positioned to create and sustain over 15,000 direct jobs and generate an estimated forex of $300mn. This is because funding intervention would be targeted at sectors with high employment potentials like agriculture, mining, tourism and the entertainment and creative art industry.
When would the ECOWAS sea-link start and who would be the owners of the company?
As you know, the ECOWAS sea link project is an initiative of the NEXIM Bank and the organised private sector. It is targeted at facilitating intra-regional trade within the ECOWAS sub-region and even extending to Central Africa. It aims to not only deepen trade within ECOWAS but to also reduce cost and time of movement of goods, services and people within the sub-region in line with the core charter of the ECOWAS. Though a definite date has not been fixed for the vessels to start operating, the bank has since commenced the promotional arrangements to set up appropriate structures and arrangements in that regard. For now, NEXIM and some key developmental partners along with the ECOWAS chambers of Commerce will drive the establishment of the project to ensure it starts on a sound and efficient footing. Eventually, the initiative would be arranged in such a way that it will be owned by the private sector players within the region and listed in different stock exchanges.
Source: thenewsafrica.com/2011/06/13/nigeria-must-expand-non-oil-export/
