The Bankers Committee has decided to increase lending to the agricultural sector by N300 billion in 2016.
The Committee comprise top management of the Central Bank of Nigeria (CBN) and chief executives of banks in the country.
CBN Governor, Mr. Godwin Emefiele disclosed this while
addressing journalists at the end of the 7th annual retreat of the
Committee in Lagos.
The committee however stressed the need for provision of
infrastructure necessary to enhance supply of agricultural products in
the country.
Emefiele said, “Banks generally agreed to increase lending
to the agricultural sector, but the committee feels that there is the
need to de-risk the agricultural value chain. The bankers’ committee also feels that the monetary and fiscal authorities need to work together in a collaborative
manner to achieve the objective of improving local production of
specific agricultural products, so that as a result of lending to this
sector, we can begin to see a reduction in the demand for foreign
exchange that would help to conserve our foreign exchange reserves and
strengthen our currency.
“Banks feel that there is a need to improve the level of
infrastructure in various sectors. For instance, build more Fadama
roads, build more silos and warehouses to receive final produce, so that
products don’t get destroyed at the farm.
“We should have Fadama roads which makes it easy for goods
to be transported from the local communities to areas where they could
be sold to increase the wealth of those in our local communities.
“Banks therefore set a target to boost agrictultural
lending not only to the small and medium enterprises, but also to large
scale farming and companies to up to N300 billion in 2016.”
He said that the committee also resolved to evolve
measures to support small and medium enterprises in the country as well
as boost employment.
He said, ” Banks also looked at financing SMEs. The
recognised that there is a need for a paradigm shift in the feeling that
SMEs are in an endangered sector. Banks recognised that the BVN would
assist in creating a pool of SME loans in the country. We however agreed
that there is a need to take identified SMEs through capacity building
in skills in record keeping and how to run their business. This, we
believe would make the SMEs more bankable.
“Banks agreed to support all efforts of government to
boost employment of young graduates in the country. Of course in the
area of infrastructure, banks identified power, roads, as strong
enablers and drivers of growth in the country.
“Banks agreed to play their part in supporting power and
financing of other infrastructure, but that all hands should be on deck,
not just from the monetary authorities, but also from the fiscal
authorities, to boost power, transportation so that we can achieve the
goal of growing the number of graduates.
Speaking on the achievements of previous retreat, Emefiele said, “Previous bankers’ committee
retreat has helped to increase lending to the manufacturing sector and
it has also helped in facilitating finance to the power and aviation
sectors.
“Thirdly, it has helped to incentivise lending to the
agricultural sector where we have seen lending to the sector increasing
from as low as one per cent in 2010/2011, to as high as four per cent in
2014/2015.
“The purpose of the retreat was to discuss how to support
government’s efforts at diversifying the economy in the face of the
sharp drop in oil prices.”
The two day retreat was attended by the Lagos State
Governor, Mr. Akinwunmi Ambode; ministers of Agriculture, Chief Audu
Ogbeh; Power, Works and Housing, Mr. Babatunde Raji Fashola;
Transportation, Mr. Rotimi Amaechi; Solid Minerals, Mr. Kayode Fayemi;
Finance, Kemi Adeosun, as well as practitioners in agricultural, power
and small business sectors.
By Babajide Komolafe
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