Emefiele, Sanwo-Olu seek structural adjustments to stabilise FX market

The Governor of the Central Bank of Nigeria (CBN), Godwin Emefiele, yesterday, called for the “design and steadfast implementation of other supportive, structural and complementary policies” to stabilise the foreign exchange (FX).

Making the call at the maiden edition of the RT200 Non-oil Export Summit, Emefiele said stand-alone monetary tools could not achieve the needed stability without effective steadfast structural adjustments and fiscal reforms to boost the performance of the external sector.

“The Nigerian economy has been challenged on many fronts in recent years due to a combination of local and global factors. Disruptions due to the COVID-19 pandemic, delays in global logistic value chains and local security challenges have exerted undue pressure on our economy, making macroeconomic management very difficult. These factors impacted oil production and prices, disrupted trade and exports, reduced capital inflows and impacted food production. They also exposed the fragility of the Nigerian economy and the need for a more diversified economy.

“In the face of these challenges, the CBN has been confronted with rising demand for foreign exchange for both goods, services and other needs. With this unabating demand, the Bank has been working to manage both the demand and supply side to meet foreign exchange obligations.”

Emefiele, who was joined by Gov. Babajide Sanwo-Olu in his advocacy, said non-oil export has improved significantly since the implementation of the RT200 FX Programme in February, with the apex bank paying out N3.5 billion in rebates to exporters at the end of first quarter alone.

He acknowledged the role of efficient and cost-effective port services in growing the non-oil exports and expressed the desire of his team to work with the Nigeria Ports Authority (NPA) and other relevant stakeholders to create a supportive infrastructure. With adequate and efficient infrastructure, he stressed, the country has huge potential it could leverage to build a competitive export market.

“This is the time for all of us to work together to reposition Nigeria on a growth trajectory by taking diversification of the economy seriously. This is the time to start working in synergy for the good of our nation. This is the time for us as a banking community to do more and support exporters who have been flying the flag of Nigeria in the international market space,” Emefiele, who recounted the exploits of countries with less natural resources than Nigeria, urged participants.

Sanwo-Olu was optimistic that the Lekki Deep Seaport, which would be operational before the end of the year, and the proposed Badagry Deep Seaport currently awaiting approval of the Federal Executive Council (FEC), would decongest Apapa ports and improve access to port services for export purposes.

The governor urged exporters to take advantage of the Non-oil FX Rebate Scheme to grow the country’s FX earnings, saying that the country needs to urgently improve its export volumes to support growth and create jobs.

Non-oil FX Rebate Scheme as well as the summit are two of the five pillars of the RT200 FX Programme, which seeks to raise non-oil export FX repatriation to $200 billion in the next three to five years. The other components are Value-Adding Exports Facility, Non-oil Commodities Expansion Facility and Dedicated Non-oil Export Terminal.

Given the level of congestion in Lagos and the attendant cost of accessing ports in the city, some of the participants called for the building of export-dedicated ports that could be located in any other coastal state.

Emefiele had, during the unveiling of the scheme, said the CBN was willing to work with any state government to develop an export dedicated port facility.