Lagos Chamber of Commerce and Industry (LCCI) says exporters’ easy access to funding from Nigerian Export – Import Bank (NEXIM) would accelerate the country’s economic growth from the impacts of COVID-19 pandemic.
Mrs Toki Mabogunje, President, LCCI made the assertion at a webinar on funding opportunities for exporters with NEXIM bank on Thursday.
Mabogunje, represented by LCCI Honorary Treasurer, Mr Abimbola Olashore, said accessible funding would also engender value addition on primary raw materials and generate the desired level of foreign exchange needed to achieve economic diversification.
Mabogunje said efforts to diversify the export base of the economy from crude oil over the years had not produced desired outcomes with more than 85 per cent of Nigeria’s foreign exchange earnings from crude oil.
She stressed that the non-oil export sector had the potentials to generate adequate quantum of foreign exchange earnings for the economy and strengthen the Naira against major currencies.
Mabogunje said that the country was blessed with vast raw materials in the non-oil sector which can be leveraged to increase exports and improve our trade balance.
She, however, noted that exportation of primary products without value addition through processing would not generate the desired level of foreign exchange needed to achieve economic diversification and accelerate economic growth.
She implored the fiscal and monetary sides of policy authorities to take critical steps in providing a supportive operating environment for non-oil exporters for value-adding activities.
“Nigeria’s non-oil export sector is dominated by raw material and primary product exports over the years.
“We could have generated much more in foreign exchange earnings if those raw materials were processed into value-added commodities before exportation.
“However, many manufacturers are not adequately abreast with the intricacies and availability of funding opportunities, particularly, by the NEXIM bank.
“Without addressing these major challenges, it will be increasingly difficult for the economy to leverage the recent exchange rate depreciation of the Naira to enhance global competitiveness and correct our external imbalance.
“Therefore, we implore policymakers as a matter of urgency to create the enabling environment that would enable non-oil exporters add value to primary products before exportation.
“While some steps taken recently by the government on improving the fortunes of non-oil export are commendable, however, we need to do more.
“Today, we are focusing on funding opportunities for exporters by NEXIM Bank and are pleased to have them give us insights into these opportunities,” she said.
Chairperson, LCCI Export Group, Mrs Bosun Solarin, urged the bank to embrace newer exporters and request reasonable funding collaterals to engender manufacturing competitiveness in the Africa Continental Free Trade Area (AfCFTA).
Solarin also called for an increase in turnaround time for fund disbursement, and greater support for women – owned businesses to push Nigeria’s export diversification agenda to an enviable point.
“We want the bank to embrace the new set of exporters and reduce their requirements which may be difficult for new exporters to meet.
“Requirements such as adequate collateral of not less than 150 per cent of loan value needs to be addressed and women owned businesses given preference to compete well in AfCFTA,” she said.
Responding, Mr Ugenyi Kalu, Head, Lagos Regional Office, Nigerian Export -Import Bank, said the bank welcomed applications from bankable projects and exporters in target sectors.
Kalu said the target sectors included manufacturing, agriculture, solid minerals, transport, tourism and entertainment amongst others.
He added that the bank in line with its mandate was ready to give support to the non-oil sector by providing financial services, risk bearing services, funds management, and advisory services.
“NEXIM is particularly interested in supporting and working with Small and Medium Enterprises (SME) to position Nigerian entrepreneurs to benefit from intra-African and global trade.
“There are several export development opportunities for SMEs through collaborations and strategic partnerships with NEXIM bank.
“We have the Small and Medium Enterprises Export Facility aimed at increasing deliberate funding to SME towards broadening Nigeria’s export basket, facilitate industrialisation for value added exports.
“Our recently launched Women and Youth in Export Facility (WAYEF) is also aimed at upscaling women and youth in the non-export value chain to enable them take advantage of the numerous potentials in international trade,” he said.