Africa: The Nigerian Export-Import Bank (NEXIM) Appointed Managing Agent ofnegerian Federal Government’s Export Stimulating Facility
LAGOS, Nigeria, Mareeg.com-The Nigerian Export-Import Bank (NEXIM) has been appointed by the Federal Government of Nigeria as managing agent of the newly introduced Export Stimulation and Export Rediscounting and Refinancing facilities to support the dwindling export market and boost the country’s revenues and foreign exchange earnings.
In a statement released by the Bank during a press conference held in Lagos to unveil the two facilities to the public, the Acting Managing Director, Mr Bashir M. Wali commended the Central Bank of Nigeria (CBN) for taking a step in the right direction. He said “the ESF and RRF (for N500billion and N50billion) have come at the right time where positive steps are being taken by government towards diversifying the Nigerian economy away from oil and enhancing revenue flow to the non-oil sector as a measure to trigger export growth and economic progress.” He further thanked the Central Bank of Nigeria for providing these funding development schemes and for the timely release of the operating guidelines; less than a month after presenting the initial draft.
The representative of the Director, Development Finance Department, Mrs Udoo Fateh gave a broad overview of the facilities and also used the opportunity to thank the management of the Central Bank she said “I want to recognise the efforts of the CBN for availing Nigerian exporters an opportunity to grow their businesses and increase foreign exchange earnings to create more jobs for the teeming youths.”
The facilities are essentially designed to redress the declining export credit and reposition the sector to increase its contribution to revenue generation and economic development in order to improve export financing, increase access of exporters to low interest credit and offer additional opportunities for them to upscale and expand their businesses/improve their competiveness.
Referring to the CBN guidelines, the NEXIM chief indicated that the objectives of the ESF are to: a) Improve access of exporters to concessionary finance to expand and diversify the non-oil export baskets; b) Attract new investments and encourage re-investments in value-added non-oil exports production and non-traditional exports; c) Shore up non-oil export sector productivity and create more jobs; d) Support export oriented companies to upscale and expand their export operations as well as capabilities; e) Diversify and increase the level of contribution of non-oil exports revenue towards sustainable economic development; and f) Broaden the scope of export financing instruments.
Furthermore, he stated that only export-oriented enterprises shall be eligible under the ESF. Such shall include companies duly incorporated in Nigeria under Companies and Allied Matters Act (CAMA) with verifiable export off-take contract(s). The company shall also have satisfactory credit reports from at least two Credit Bureaus in line with the provisions of the relevant CBN Circular.
The transactions permissible for funding under the ESF include, (i) export of goods wholly or partly processed or manufactured in Nigeria; (ii) export of commodities and services, which are permissible and excluded under existing export prohibition list; (iii) imports of plant & machinery, spare parts and packaging materials, required for export oriented production that cannot be produced locally; (iv) export value chain support services such as transportation, warehousing and quality assurance infrastructure. (v) resuscitation, expansion, modernization and technology upgrade of nonoil exports industries and; (vi) stocking Facility/Working capital.
Speaking further on the Export Stimulation Facility, Mr. Wali stated that it shall be operated at an “all-in” Interest rate, under a risk based pricing model in line with CBN Circular BSD/DIR/GEN/CIR/04/015 of April 30, 2010 as follows: a) Facilities with a tenor of up to three (3) years, would be granted at a maximum all-in interest rate of seven and half percent (7.5%) per annum, and b) Facilities with tenor of over three (3) years, would be granted at a maximum all-in interest rate of nine percent (9%) per annum.
On the N50 Billion Export Credit Rediscounting and Refinancing Facilities (RRF), Mr. Wali informed the participants that it is an enhancement of the existing NEXIM Bank’s RRF window by the Central Bank to ensure continuous flow of credit to the export sector at competitive rates, especially against the background of declining export loans and the need to promote sustainable non-oil exports. The purpose is to create a liquidity window in support of Deposit Money Banks (DMBs) to encourage them to provide more pre- and post-shipment finance to exporters.
Thanking the participants and other stakeholders, Mr. Bashir Wali assured all parties of the commitment of the Bank to work assiduously towards the full realisation of the objectives of the schemes and will be willing to provide additional information or clarifications as may be required.
He thanked the Nigerian Export Promotion Council (NEPC), the Manufacturers’ Association of Nigeria (MAN), the commodity associations and other organised private sector for their relentless technical support, partnership and collaboration as well as the commitment to work with the Government and private sector in Nigeria to diversify the economy boost industrial production and exports.
Mr. Wali finally used the opportunity to call on all eligible export-oriented companies with permissible transactions under the schemes to actively participate by submitting thorough proposals for consideration through the Participating Financial Institution of their choice.
Distributed by APO (African Press Organization)