The Nigerian economy, prior to the advent petro-dollar (oil boom) years of the 1970s, was basically agricultural based. Agriculture contributed about 65 per cent to the GDP and represented 70 per cent of total exports. The sector was marked with high labour-absorptive ratio and provided the scarce foreign exchange needed for the importation of raw materials, machine spare-parts and other capital goods required for few available industries. These suddenly became history with the growing importance of oil, and agriculture was sidelined to the extent that Nigeria could hardly feed her population again from her agricultural activities. The petro-dollar era also brought with it other challenges. Nigeria is today battling with dwindling foreign reserves owing to our huge importation bills, thereby affecting the naira exchange value.

The scenario painted above was the situation when Godwin Emefiele, the Governor of the Central Bank of Nigeria (CBN) assumed office two years ago giving insight into what would be his mission at the apex bank which he encapsulated in his 10-point agenda. He had said that the CBN, under his watch, would spend its energies and resources to build a resilient financial system that would serve the growth and development needs of the country using development bank strategies as the fulcrum of his policy to drive the economy. Not only that, Emefiele committed himself to creating “a central bank that is professional, a central bank that is apolitical, and people-focused and a CBN that would pursue a gradual reduction in interest rates.

In line with this vision, the CBN, under his leadership, has pursued with added vigour intervention schemes such as Agricultural Credit Guarantee Scheme (ACGS), Commercial Agriculture Credit Scheme (CACS), the 220 billion naira Micro, Small and Medium Enterprise Development Fund (MSMEDF), Small and Medium Enterprises Credit Guarantee Scheme (SMECGS), and the very recently launched Anchor Borrowers’ Programme (ABP) to mention but a few.

The collapse of the global commodity prices as experienced in 2014, and particularly, the crash in crude oil prices, which went as low as $27 did not help matters. And as this was happening, Nigeria still maintained huge import bill that necessitated the CBN’s action restricting 41 items from access to FOREX from the inter-bank window. This was a major policy plank to curtail the hemorrhage in the nation’s reserves and stabilise the exchange rate of the Naira. The policies and initiatives as expected were not well received by the predatorily Western economic interests and vicious speculators which prompted the CBN, at a point to close the rDAS/wDAS FOREX window, among other measures to check further pressure on the exchange rate and also preserve the country’s foreign reserves.

In addition to all these was the battle to stem the avalanche of liquidity surfeit arising from huge campaign expenses of the 2015 general elections, which is characteristic of any electioneering year and the attendant inflationary pressure. Given the transition to a new government, the CBN saw itself playing a critical role in terms of macroeconomic management holding forte for the new government to stabilise. Thus, the Bank unleashed various measures as a way to stabilise the economy. One glaring fact about Godwin Emefiele led-CBN was its stubborn disposition and ability to tame the currency speculators prying on the Naira exchange rate by introducing various measures including the latest flexible exchange rate regime.

The thrust of Emefiele’s philosophy is ‘produce, add value and export’ (PAVE) in which he has been admonishing Nigerians to return to the farm, produce and buy what is produced in Nigeria as a more sustainable way to ensure economic stability and minimise dependence on oil. What is urgently required as complimentary is a handshake by the fiscal authority to come up with policies to ensure a more enduring and sustainable economic management since monetary policy alone is not enough to sustain macroeconomic development for a long period of time.

Though the decision to ban 41 items from the inter-bank FOREX window was greeted with criticism, patriotic Nigerians applauded the policy measure as a giant leap in the right direction aimed at placing Nigeria firmly on the track of sustainable development, nay sound economic ground.

Right from the establishment of ACGS in 1977 through CACS to MSMEDF and the ABP, the CBN has always underscored its determination to support the strategic sectors in order to ensure a strong currency brought about by an active and productive real sector. Knowing full well that the challenge of many farmers and other participants in the real sector is the access to adequate funding, the CBN under Emefiele has provided an enabling environment and made available sufficient funds that can be accessed by this group of willing actors and entrepreneurs for them to create wealth, generate employment and add value to the Nigerian economy.

The CBN set aside N40 billion out of the N220 billion Micro, Small and Medium Enterprise Development Fund (MSMEDF) for farmers at a single-digit interest rate, particularly under the Anchor Borrowers Programme. This essentially was to create economic linkages between 600,000 small farmers and reputable large-scale processors with a view to increasing agricultural output and to significantly improve capacity utilisation of integrated mills. The CBN took the bold step to ensure that Nigerian jobs are not exported even as it canvasses a change in the preference of Nigerians for foreign made items we are capable of producing at home. Indeed, with the resolve of the fiscal and monetary authorities to pursue economic diversification and halt the importation of what can be produced locally, particularly items such as rice, wheat, palm oil, sugar and textile, among others, the CBN intervention programmes would bear the desired fruits.

This done, Nigerians can then look forward with assured optimism that the nation will soon be self-sufficient as it was decades back in her agricultural sector and turn the tide by reducing Nigeria’s import bill by at least 40 percent annually.

A very subtle gospel, being preached by Mr. Godwin Emefiele, which Nigerians need to take seriously, is the philosophy of PAVE – Produce, Add Value and Export.

•Abdulkadir Musa sent in this piece from Kebbi State. Photo shows CBN Governor Emefiele.

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