Heritage Bank Limited has identified major commodities that can boost
Nigeria’s foreign exchange earnings in the non-oil sector for the
country.
Some of the export potential products as
listed by the bank in the agriculture sector are:
cocoa, cashew,
groundnut, fish, horns, sesame seed, ginger, cassava and snails. Others
include tobacco, coffee, cotton lint, rubber, among others. Under
Vegetables and spices, the lender identified Bitter leaf, plantain
flour, Ground melon, Ground Crayfish, Ground Maize among possible
foreign exchange earners.
Managing Director/ Chief Executive
Officer, Heritage Bank Limited, Mr. Ifie Sekibo said farmers and
exporters of agricultural produce should seek more knowledge in order to
increase the quality and quantity of their products because export
business involves dealings with other world players.
The bank chief who spoke at the 2016
Annual Conference organised by Finance Correspondents Association of
Nigeria (FICAN) in Lagos recently said the 10-year tenor export
stimulation facility provided by the Central Bank of Nigeria (CBN) at
nine per cent interest rate is a laudable incentive for exporters.
According to him, although the lenders
would want the economy to grow by lending to farmers and other
productive sectors of the economy, farmers/borrowers/exporters on their
part should know that banks want their monies back and that “there is
need for competence, commitment and confidence in the process.”
Speaking on the topic: “Providing Finance
for Exports: Expectation & Experience,” Sekibo said Nigeria can
also export such manufactured Goods as: Cocoa cakes, butter, powder
& liquor, detergents, Malt drinks Palm kernel cakes & oil, baby
clothes, confectioneries, leather. In the category of handicraft, Sekibo
noted that Nigeria can export Talking drums, Calabash, Wood carvings,
Raffia products among others, not forgetting the ever flourishing
Nollywood which is even being watched by Militants (like Gendam) in
neighbouring countries.
Represented by the Group Head,
Agriculture Finance, Project & Development Finance Department of
Heritage Bank, Mr. Olugbenga Awe, Sekibo regretted that exporters from
Nigeria are not competitive enough, such that some Nigerian exporters go
to Cameroun to bring in products, blend them to Nigerian products so
that they can export. For instance, Yams that are consumed in London are
from Ghana, not Nigeria.
As a country, Nigeria cannot afford to continue going backward in terms of non-oil export he reiterated.
The banker therefore advised exporters to
master the steps to getting funding for export. He said, the first step
is to know the difference between funds required for financing the
business between the commencement of the manufacturing or procuring
process and the dispatch of the goods, known as pre-shipment finance;
and that of post-shipment finance, which are funds required for
financing the exporter between the dispatch of goods and the receipt of
payment.
It should be recalled that in recognition
of Heritage Bank’s commitment to promoting non-oil export business, the
African Export Import Bank (Afreximbank) recently provided a $150
million funding support for the lender.
Afreximbank, a frontline African
financial institution believes in the uniqueness of the business
strategy of Heritage Bank especially the Small Growing Business focus of
the bank which aligns with the founding mission of Afreximbank.
According to Sekibo, exporters should also know that banks look for certain criteria for financing.
“There must be history of previous
performance in terms of volume of export handled in the past; Frequency
of Export; Payment methods; Payment Terms; how Products are sourced and
how risk are mitigated,” he said.
Banks according to him also look at seasonality of the products; product destination; transaction cycle and buyer’s payment history.
by Nume Ekeghe/Thisday
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