The Central Bank of Nigeria (CBN) has assured that the manufacturing and agricultural sectors will enjoy single digit interest rates as it would fast track lending of a reserved special intervention fund earmarked for the sectors.
The CBN has set aside N235 billion and N750 billion as intervention funds for the manufacturing and agricultural sectors respectively, which it describes as pivotal in the resuscitation of the nation’s ailing economy.
The CBN Director, Banking Supervision, Mrs. Tokunbo Martins, made the disclosure in Abuja, while briefing the media on the outcome of Bankers’ Committee meeting. She also revealed the joint decision by CBN and Bankers’ Committee to increase limit of banks’ FOREX sale to Bureaux De Change (BDCs) to $50,000 from $30,000 it was two weeks ago.
Martins, accompanied to the briefing by Group Managing Director of United Bank for Africa (UBA), Kennedy Uzoka, Zenith Bank Group Managing Director, Peter Amangbo, and Hassan Usman of Jaiz Bank Plc, said the decision to utilise CBN’s special reserved funds for lending to agricultural and manufacturing sectors was taken to hurriedly revamp the economy.
Reacting to the Bankers’ Committee meeting, the Chief Executive Officer, Financial Derivatives Limited, Mr. Bismark Rewane, who lauded the CBN’s support for the two critical sectors, equally took a swipe on the Federal Government for allowing them to fail in the first place.
Rewane said what the economy needs at this point in time are efficient markets and fresh investments, considering the fact that the Gross Domestic Product (GDP) is already negative. According to him, the initiative is tantamount to medicine after death, saying these are economic palliatives usually introduced after failure.
Also commenting on the committee’s decision, a former Deputy Governor of CBN, Dr Obadiah Mailafia said it is a very good development which he described as long overdue. He however pleaded for immediate implementation.
“The implementation of it should be done properly and transparently, because our banks have the tendency to declare something and then the charges will be more than the officially declared interest rate. Also, some of these bankers have the intention to allocate it to themselves and their relations to the detriment of those who truly deserve it. If it is transparently, professionally and efficiently managed, it is very welcome,” he added.