The President, Chartered Institute of Bankers of Nigeria, Prof. Segun Ajibola, says the financial services sector must redirect the economy to the path of recovery by channeling a major part of their loan portfolio to Micro, Small and Medium Enterprises financing.
He spoke in Abuja at the 10th edition of the Annual Banking and Finance Conference, tagged, ‘Innovation in the financial services sector: Driving Nigeria’s new economy.’
Ajibola noted that the economic recession in the country could be traced to years of “skewed economic structure” as manifested in the monolithic nature of the source of Federal Government foreign exchange earnings.
He said, “Our economy has been overstretched with the level of foreign exchange reserves hovering around $25bn, perhaps the lowest in recent decades and barely able to support six months import bills.
I believe this is the time the financial services sector needs to play some catalystic roles to redirect the economy path of recovery, growth and development.”
In a bit to recover the economy, Ajibola stressed the need to give MSMEs necessary support through a lasting initiative modelled after countries like Malaysia and South Korea.
The CIBN President said, “Nigeria has experimented with multitude of policies and programmes aimed at supporting this lower end of the economy with minimal results.
“Perhaps, one way of entrenching a lasting initiative is to benchmark the models already successfully implemented in countries such as India, Malaysia, South Korea and Indonesia where the contribution of micro businesses to the GDP hovers around 75 percent. He added, “South Korea, for example, recovered from the Asian Financial Crisis of 1997 through the SMEs. In 1999, the SMEs accounted for 81.9 percent of industrial employments and 74.3 percent of total manufacturing in the country.
“We should also be prepared to accept the truism that the promotion of this segment of the economy can succeed if only the various institutions and agencies provide their complementary roles of providing the enabling environment, infrastructural base and funding support.”
Earlier, the Governor, Central Bank of Nigeria, Mr. Godwin Emefiele, in his Keynote address, had emphasized the importance of an improved payment system to sustainable economic growth.
He noted that the successes recorded in the e-payment space in the country were made possible through programmes aimed at migrating transactions from cash to electronic payments.
Emefiele said, “In order to sustain this progress, the CBN launched the second the second phase of the National Strategy in September 2013, aimed at ensuring safety, improving efficiency and integrating effectively into the global payments system through compliance with international standards.
The CBN governor stated that Nigeria’s transaction-to-fraud rate had dropped significantly in 2015 to 0.01 percent, representing a 63 percent reduction.
Below are pictures from the event
NCC says 123m Nigerians now have internet
The Nigerian Communications Commission (NCC) says the number of Nigerians with access to the internet has increased to 123.5 million in October.
This is in comparison to the 114.3 million internet subscribers recorded in January 2019; indicating an increase of 9.2 million within nine months.
Data released by the commission also showed that active mobile voice subscribers increased from 174,012,136 to 180,386,316 within the same period.
This means that 91% of Nigeria’s 198 million population now have access to telecommunications services.
MTN Nigeria still holds the lion share of the market, having 67,348,858 subscribers which translate to 36.93%.
Globacom has 51,137,642 subscribers and Airtel, 49,650,155 subscribers.
In total, there are 49 individual internet service providers operating in the country.
These 49 provide services to 274,717 subscribers.
At present, there is a risk of increased charges on the part of service providers as 14 states recently increased their right of way (RoW) charges.
The RoW charge is the levy paid to state governments for laying of optic fibre on state roads.
Some of the states increased the charges to N5,000 per linear metre as against the N142 per linear metre agreed on by the national economic council.
Isa Pantami, the minister of communications and digital economy, has warned the states to reverse the charges as it could lead to increased costs of telcos and a hike in consumer charges.
Crude oil prices approach $70 after US attack on Iranian general
Crude oil prices spiked by 4% on Friday upon news that a top Iranian general was killed in an airstrike by the United States military.
Brent crude futures, the international benchmark for crude oil, stood at $69.01 per barrel, an increase of 4.17%.
US West Texas Intermediate (WTI) also stood at $63.34 per barrel, a 4% increase.
The Pentagon said the attack was carried out on the order of President Donald Trump to deter “future Iranian attack plans”.
It added that Soleimani was killed because he “was actively developing plans to attack American diplomats and service members in Iraq and throughout the region”.
The airstrike comes days after an Iran-backed militia and its supporters breached the US embassy in Baghdad.
Iraqi Popular Mobilisation Forces (PMF) confirmed that Abu Mahdi al-Muhandis, deputy head of the force, was also among those “martyred by an American strike”.
In September, oil prices increased by 14% after coordinated attacks were carried out on Saudi Arabia’s oil facilities which cut off 5% of global oil supplies.
Working in Nigeria’s good
Although world leaders are holding their breath awaiting Iran’s next action, the situation is working in favour of oil producing nations like Nigeria.
Already, Brent crude price is $9 above Nigeria’s crude oil budget benchmark.
A reprisal attack by Iran could send oil prices as high as $100 as global crude supply could be threatened.
Sylva: FG making plans for fuel at N97 per litre
Timipre Sylva, minister of state for petroleum resources, says the federal government is working to make fuel available at N97 per litre, using the compressed natural gas (CNG) as an option to premium motor spirit (PMS).
CNG is a fuel that can be used in place of gasoline, diesel fuel and liquefied petroleum gas (LPG). It is used in traditional gasoline/internal combustion engine automobiles or specifically manufactured vehicles.
Fielding questions from reporters at his office in Abuja on Thursday, the minister said the common man would not notice that subsidy on PMS has been removed when they have CNG as an option.
“If we are thinking of reducing pump price for fuel? I could easily say yes and I’m sure all of you wonder why I am saying that,” he said.
“We are thinking of giving the masses an alternative. Today we are all hooked on PMS, what we want to do going forward is to see that we are able to move the masses to CNG gas.
“CNG unit for unit costs less than even the subsidised PMS. Per litre the subsidised rate of PMS is N145/l. CNG will cost N95 to N97/l that is why I could say we want to reduce the cost of fuel, that way when we are given an alternative Nigerians will not notice when the subsidy on PMS is removed.”
The minister said he is hoping that the petroleum industry bill (PIB) will be passed by the national assembly before May.
According to him, the PIB “has taken us back for too long.”
“We are very ambitious about the PIB and we are hoping that it will pass before May this year which is the first anniversary of this administration and second tenure of this government,” he said.
“We are counting on the excellent relationship between the executive and the legislature but I must say that it is a hope and that is why I am mobilising the support of all of you. We are also mobilising the support of the national assembly and everybody else in the industry.
“Let us build a consensus around the PIB because the PIB has taken us back for too long, it has held us down for too long and we need to get it passed quickly. It is taking us a while to tidy up because we want to take every interest on board.”
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