Post by Trade facilitator on Apr 6, 2012 22:05:29 GMT 1
MR ROBERTS U. ORYA assumed the corporate leadership of Nigeria Export – Import (NEXIM) Bank as MD/Chief Executive Officer after over 25 years in the Banking industry. In this interview with national accord reporter, Mule Japheth, he assures that the bank would continue to play an effective role in the Nigerian economy. Excerpts.
What was the general atmosphere in NEXIM bank before your assumption of office as chief executive?
The challenge or success of the Nigeria Export Import Bank (NEXIM) since 2009 is a product of carful planning, something that had eluded the bank for sometime. My team and I, on coming into office dedicated our selves to bringing about a rapid and sustained transformation that has completely changed the fortunes of the Bank.
One important point to be noted is that before now, the banks were in the deficit.
The current robust state of the Bank is an indication that Nigeria is steadily realizing her export promotion targets in the non-oil sector which has been elusive over the years.
Early this year, you were at the senate to defend your budget proposals, how did the situation go?
I was at the senate committee on Budget and Insurance to defend the bank’s 2012 budget. I made it clear that NEXIM under my leadership targets a profit of N1.6 billion as against the N1.1billion in the last fiscal year 2011.
At the budget defence, I announced the determination of NEXIM to give an urgent attention to the non-oil sectors of the economy – manufacturing Agriculture, solid minerals and services (MASS) – which will tap into the hitherto virgin sectors and propel Nigerians economy beyond traditional areas of business. Towards this, we presented a budget projection of =N= 30bn to promote export – oriented investments in these sectors. 44 percent will go to manufacturing, 35.8 percent agriculture, 5.6 percent solid minerals resources, while services take 14 percent.
This will create over 23,923 jobs and will generate $229.6m in foreign exchange earnings for Nigerian in the 2012 fiscal year through active support of the anufacturing, agricultural, solid mineral and services sectors of the nation’s economy. Taking the committee through the business activities of the Bank for the year 2011, I explained that what the Bank has done over the years towards the realization of it’s mandate which is to enhance the contribution of the non-oil sector to the GDP through funding interventions in the MASS sectors where the country has high export potentials and comparative advantage. For instance, in the agricultural sector, NEXIM has funded a lot of Green field and starting projects that have become successful and are published on the CBN’s Top 100 Exporters list.
We have intensified support for the mining sector by providing the required assistance to get the industry well structured. Despite the enormous risks, NEXIM is stepping up to it’s role as a development financial institution, to promote the relevant products to stimulate and attract investment to the mining sector to make it more viable and attractive for both the commercial banks and every other private entity that is interested to operate there.
As we speak, a lot of work has gone into charting an investor friendly policy framework for the mining sector in order to ensure full realization of the huge potentials therein, which economic impact would no doubt surpass that of the oil and gas sectors.
Nigerians are so keen about tourism, what are you doing to enhance it as a revenue earner for the nation?
As part of my mandate, NEXIM is also working at the services sector, especially financing the development of branded and rated hotels in line with the Nigerian Tourism Development master plan as well as other services with high export potentials. We are looking at the creative arts and entertainment industry because we believe that it’s an industry that has a high growth, employment and foreign exchange earning potentials. It is essentially an area where you can generate a lot of employment for our youths.
Are you interested in the pattern of Inter-African trade?
Since the past year, as part of efforts to boost trade for Nigerian exporters NEXIM has shown keenness to deepen trade within the Economic Community of West African States (ECOWAS) sub-region. We looked at the status of Nigeria within the sub-region and realized that the population of ECOWAS is over 300 million, with Nigeria constituting about 165 million of that figure.
It becomes obvious to us that this is the largest market and about the most dominant economy where every serious investor should show interest to invest. Regrettably, there are patent obstacles to enabling Nigeria fully exploit the benefits of this position especially the issue of trade barriers.
This informed the idea of the Bank coming up with an initiative to alleviate the issue of intra-regional trade and integration such as the unavailability of an efficient sea transportation system that can directly connect the regions.
Let me point for you a simple, but powerful illustration of the problems faced by Nigerian exporters, if you have to move your goods from Lagos to Tema port in Ghana by truck, with all the non-tariff barriers, etc, it might take you two – six days, but if you have to move your goods from Apapa port in Nigeria to Tema Port in Ghana by sea, it may take you about 60 days.
This is because the vessels would first sail directly to their homeports in Europe or South Africa and from there make a trans-shipment of the goods back to Tema port. Under this kind of scenario, there is no way one can deepen trade, because we don’t have our own sea – going cargo vessels.
At budget defence, I told the committee that if a country like Nigeria does not take steps to see how the trade barrier could be addressed there is no way trade would improve within the region. This prompted NEXIM Bank to come up with an initiative to facilitate a dedicated regional sea link company which will be private sector driven for the benefit of West and Central African Countries with Nigeria getting the most because of the size of it’s economy.
The goal is to have a regional maritime shipping company that would essentially serve and transport persons and goods between the two neighboring regions.
What are your good intentions for Sealink?
As I informed the senate committee, NEXIM has come up with a promotional company as a special purpose vehicle that would set up the Regional Sealink company and raise the initial funding requirement of about $61.5 million in both debt and equity capital.
As soon as that money is raised and the company is incorporated the SPV which was already Incorporated in October 2011, would cease to exist. The initial sponsors of the project comprise members of the Federation of West Africa Chamber of Commerce, the members of individual ECOWAS member countries chambers of commerce and industry, a big logistic company based in Douala, called Transimex S. A, Cameroun, among others.
The initiative has been presented and embraced by the Nigerian Maritime Administration and safety Agency (NIMASA), ECOWAS Commission, ECOWAS Parliament and other relevant stakeholders.
What are your major constrains as a chief executive of a Financial Institution like this?
Every other institution in our category, we are realistic enough to accept that there are immediate challenges on our way to achieving the level of success NEXIM Bank has set in it’s medium term plan, namely the issue of non-performing trans – NPLS.
Some of the debts, being owed the Bank, span between 10 and 15 years and some of the debtors are banks that were liquidated in 1990s by the Nigeria Deposit Insurance corporation (NDIC). The bank could only recover N48m out of about N1.9bn, it planned to recover in 2011. In 2012, we plan to recover N1.3bn. As soon as we are able to recover that, it will go into our loss and profit account. We plead with the senate to assist NEXIM in getting AMCON to write off or buy over some of the toxic debts to enable the bank clean up it’s balance sheet.
With this explanation, how is the Bank trying to return to the profitable path?
Yes, with this, we were able to function and make profit during the global financial crises and have continued to operate profitably because we took a holistic approach in the bank’s corporate transformation which entails strategies around adequate capitalization, adoption of a robust enterprise – wide risk management framework, good corporate governance principles, smarter business processes, clear focus and compliance with regulations and relevant government policies.
I also acknowledge the harmonious synergy the bank enjoys with its shareholders – the Central Bank of Nigeria and the Ministry of Finance which is also part of our mandate to leverage government’s funding, and non-funding activities like risk bearing facilities of non-oil export credit guarantee and insurance as well as market and trade information and value-added export business advisory services.
Apart from ECOWAS sub-region do you involve in business with other continents across the world?
Of course yes. We have signed memorandum of understanding (MoU) with EXIM Banks of China, India, among others and also participate fully in conclaves and conferences of Global Network of Export Import Banks Development Financial Institutions (G-NEXID). All these have ensured that even where NEXIM could not provide direct funding assistance, it handholds Nigerian businesses to access funds from these sister agencies.
This is in addition to other accounts of how the Bank plans to seek support from the Banks shareholders to start providing credit insurance and guarantees to buyers of Nigerian goods and services in line with the global best practices in export credit financing. NEXIM should be able to provide trade finance to buyers of Nigerian goods from any country if that Importers does not immediately have the funds.
We strive to provide financial products not readily provided by other financial institutions. For example, equity, longer term finances venture capital and provide risk bearing facilities such as non-oil export credit guarantee, insurance, market, trade information and value – added export business advisory services.
Source: nationalaccordnewspaper.com/index.php?option=com_content&view=article&id=6538:nexim-bank-set-to-boost-non-oil-sectors--orya&catid=49:national-business&Itemid=70
What was the general atmosphere in NEXIM bank before your assumption of office as chief executive?
The challenge or success of the Nigeria Export Import Bank (NEXIM) since 2009 is a product of carful planning, something that had eluded the bank for sometime. My team and I, on coming into office dedicated our selves to bringing about a rapid and sustained transformation that has completely changed the fortunes of the Bank.
One important point to be noted is that before now, the banks were in the deficit.
The current robust state of the Bank is an indication that Nigeria is steadily realizing her export promotion targets in the non-oil sector which has been elusive over the years.
Early this year, you were at the senate to defend your budget proposals, how did the situation go?
I was at the senate committee on Budget and Insurance to defend the bank’s 2012 budget. I made it clear that NEXIM under my leadership targets a profit of N1.6 billion as against the N1.1billion in the last fiscal year 2011.
At the budget defence, I announced the determination of NEXIM to give an urgent attention to the non-oil sectors of the economy – manufacturing Agriculture, solid minerals and services (MASS) – which will tap into the hitherto virgin sectors and propel Nigerians economy beyond traditional areas of business. Towards this, we presented a budget projection of =N= 30bn to promote export – oriented investments in these sectors. 44 percent will go to manufacturing, 35.8 percent agriculture, 5.6 percent solid minerals resources, while services take 14 percent.
This will create over 23,923 jobs and will generate $229.6m in foreign exchange earnings for Nigerian in the 2012 fiscal year through active support of the anufacturing, agricultural, solid mineral and services sectors of the nation’s economy. Taking the committee through the business activities of the Bank for the year 2011, I explained that what the Bank has done over the years towards the realization of it’s mandate which is to enhance the contribution of the non-oil sector to the GDP through funding interventions in the MASS sectors where the country has high export potentials and comparative advantage. For instance, in the agricultural sector, NEXIM has funded a lot of Green field and starting projects that have become successful and are published on the CBN’s Top 100 Exporters list.
We have intensified support for the mining sector by providing the required assistance to get the industry well structured. Despite the enormous risks, NEXIM is stepping up to it’s role as a development financial institution, to promote the relevant products to stimulate and attract investment to the mining sector to make it more viable and attractive for both the commercial banks and every other private entity that is interested to operate there.
As we speak, a lot of work has gone into charting an investor friendly policy framework for the mining sector in order to ensure full realization of the huge potentials therein, which economic impact would no doubt surpass that of the oil and gas sectors.
Nigerians are so keen about tourism, what are you doing to enhance it as a revenue earner for the nation?
As part of my mandate, NEXIM is also working at the services sector, especially financing the development of branded and rated hotels in line with the Nigerian Tourism Development master plan as well as other services with high export potentials. We are looking at the creative arts and entertainment industry because we believe that it’s an industry that has a high growth, employment and foreign exchange earning potentials. It is essentially an area where you can generate a lot of employment for our youths.
Are you interested in the pattern of Inter-African trade?
Since the past year, as part of efforts to boost trade for Nigerian exporters NEXIM has shown keenness to deepen trade within the Economic Community of West African States (ECOWAS) sub-region. We looked at the status of Nigeria within the sub-region and realized that the population of ECOWAS is over 300 million, with Nigeria constituting about 165 million of that figure.
It becomes obvious to us that this is the largest market and about the most dominant economy where every serious investor should show interest to invest. Regrettably, there are patent obstacles to enabling Nigeria fully exploit the benefits of this position especially the issue of trade barriers.
This informed the idea of the Bank coming up with an initiative to alleviate the issue of intra-regional trade and integration such as the unavailability of an efficient sea transportation system that can directly connect the regions.
Let me point for you a simple, but powerful illustration of the problems faced by Nigerian exporters, if you have to move your goods from Lagos to Tema port in Ghana by truck, with all the non-tariff barriers, etc, it might take you two – six days, but if you have to move your goods from Apapa port in Nigeria to Tema Port in Ghana by sea, it may take you about 60 days.
This is because the vessels would first sail directly to their homeports in Europe or South Africa and from there make a trans-shipment of the goods back to Tema port. Under this kind of scenario, there is no way one can deepen trade, because we don’t have our own sea – going cargo vessels.
At budget defence, I told the committee that if a country like Nigeria does not take steps to see how the trade barrier could be addressed there is no way trade would improve within the region. This prompted NEXIM Bank to come up with an initiative to facilitate a dedicated regional sea link company which will be private sector driven for the benefit of West and Central African Countries with Nigeria getting the most because of the size of it’s economy.
The goal is to have a regional maritime shipping company that would essentially serve and transport persons and goods between the two neighboring regions.
What are your good intentions for Sealink?
As I informed the senate committee, NEXIM has come up with a promotional company as a special purpose vehicle that would set up the Regional Sealink company and raise the initial funding requirement of about $61.5 million in both debt and equity capital.
As soon as that money is raised and the company is incorporated the SPV which was already Incorporated in October 2011, would cease to exist. The initial sponsors of the project comprise members of the Federation of West Africa Chamber of Commerce, the members of individual ECOWAS member countries chambers of commerce and industry, a big logistic company based in Douala, called Transimex S. A, Cameroun, among others.
The initiative has been presented and embraced by the Nigerian Maritime Administration and safety Agency (NIMASA), ECOWAS Commission, ECOWAS Parliament and other relevant stakeholders.
What are your major constrains as a chief executive of a Financial Institution like this?
Every other institution in our category, we are realistic enough to accept that there are immediate challenges on our way to achieving the level of success NEXIM Bank has set in it’s medium term plan, namely the issue of non-performing trans – NPLS.
Some of the debts, being owed the Bank, span between 10 and 15 years and some of the debtors are banks that were liquidated in 1990s by the Nigeria Deposit Insurance corporation (NDIC). The bank could only recover N48m out of about N1.9bn, it planned to recover in 2011. In 2012, we plan to recover N1.3bn. As soon as we are able to recover that, it will go into our loss and profit account. We plead with the senate to assist NEXIM in getting AMCON to write off or buy over some of the toxic debts to enable the bank clean up it’s balance sheet.
With this explanation, how is the Bank trying to return to the profitable path?
Yes, with this, we were able to function and make profit during the global financial crises and have continued to operate profitably because we took a holistic approach in the bank’s corporate transformation which entails strategies around adequate capitalization, adoption of a robust enterprise – wide risk management framework, good corporate governance principles, smarter business processes, clear focus and compliance with regulations and relevant government policies.
I also acknowledge the harmonious synergy the bank enjoys with its shareholders – the Central Bank of Nigeria and the Ministry of Finance which is also part of our mandate to leverage government’s funding, and non-funding activities like risk bearing facilities of non-oil export credit guarantee and insurance as well as market and trade information and value-added export business advisory services.
Apart from ECOWAS sub-region do you involve in business with other continents across the world?
Of course yes. We have signed memorandum of understanding (MoU) with EXIM Banks of China, India, among others and also participate fully in conclaves and conferences of Global Network of Export Import Banks Development Financial Institutions (G-NEXID). All these have ensured that even where NEXIM could not provide direct funding assistance, it handholds Nigerian businesses to access funds from these sister agencies.
This is in addition to other accounts of how the Bank plans to seek support from the Banks shareholders to start providing credit insurance and guarantees to buyers of Nigerian goods and services in line with the global best practices in export credit financing. NEXIM should be able to provide trade finance to buyers of Nigerian goods from any country if that Importers does not immediately have the funds.
We strive to provide financial products not readily provided by other financial institutions. For example, equity, longer term finances venture capital and provide risk bearing facilities such as non-oil export credit guarantee, insurance, market, trade information and value – added export business advisory services.
Source: nationalaccordnewspaper.com/index.php?option=com_content&view=article&id=6538:nexim-bank-set-to-boost-non-oil-sectors--orya&catid=49:national-business&Itemid=70
