CBN restates commitment to non-oil export, encourages existing exporters on CBN-NEXIM N500bn initiative

Governor of the Central Bank of Nigeria (CBN), Mr. Godwin Emefiele, on Tuesday encouraged exporters in Nigeria to take advantage of the N500 billion non-oil export stimulation facility it set up with the Nigerian Export Import Bank (NEXIM).

Emiefiele said that the Nigeria’s non-oil export if well harnessed can enable greater growth and improved foreign inflows for the Nigerian economy.

Emiefiele explained that that was why the CBN came about the Nigerian Export Import Bank (NEXIM) initiative.

He said that it is a privilege which will stimulate greater exports of processed agriculture commodities into other markets in Africa and in the global market, especially with the takeoff of the African Continental Free Trade Agreement (AfCTA).

The CBN boss disclosed these at the Zenith’s Bank 2021 export seminar, Emefiele also said that the apex bank, through its Trade Monitoring System portal (TRMS), was helping to reduce the time it takes to complete the export documentation process, as faster turnaround time could help to reduce delivery time for goods destined for exports, and enable businesses expand their output. “Today, businesses can complete their NXP applications on the TRMS portal in 30 minutes relative to two years ago, where it could take as much as two weeks to complete the process.

“We are also working with stakeholders in repositioning the Nigerian Commodity Exchange, which would help to support greater trade for operators in these vital sectors earlier mentioned. Once the exchange becomes fully operational in the second half of the year, international buyers of raw and processed agricultural commodities will be able to enter into forward contracts with domestic suppliers on the exchange, and they can be assured of not only the quality of the goods sold through the exchange, but on the expected date of delivery. We believe these forward contracts will help to support improved productivity for farmers and agro-processors, it will also help to improve access to credit for these entities using the forward contracts as collateral,” he explained.

Emefiele added that the CBN was working with key stakeholders on the African continent, particularly the Afreximbank to improve the underlying payment infrastructure to support greater intra-regional trade, through the Pan-African Payments and Settlement System (PAPSS).

This enables payments in local currency for goods in other African countries and vice versa, without the need for a third-party currency. “This initiative will help to reduce the cost of cross border trade, improve convertibility of the Naira, and increase trade opportunities for Nigerian businesses in Africa.

“Although Nigeria stands to gain from expanded trade, I believe it is also important that we pay attention to the cost that expanded trade through the AfCFTA could have on local businesses and communities. Smuggling of goods produced in non-African countries into Nigeria, and abuse of rules of origin have often resulted in significant job losses and displacements of workers in key sectors of our economy such as agriculture and manufacturing. It is vital that we work with the governing body of the AfCFTA in addressing these concerns, as it has profound implications on unemployment and security in Nigeria.