The Lagos Chamber of Commerce and Industry (LCCI) has commended the Central Bank of Nigeria (CBN) for its $200 billion foreign exchange initiative but noted that the scheme needs adequate mechanisms to achieve desired results.
Last week, the CBN introduced the RT200 FX programme, an initiative to generate $200 billion from non-oil exports and increase foreign reserves over the next three to five years.
In a statement by the Chamber’s Director-General, Dr. Chinyere Almona, the LCCI said the programme required critical export infrastructure, international trade diplomacy, and adequate funding.
Commending the scheme, she said there was a need to enlighten the public, experienced and potential exporters, on the terms and conditions around its facilities.
She warned that there are many credit facilities extended to farmers and manufacturers that may suffer non-repayment due to the high cost of production, therefore urging caution in the way the CBN intervenes in various sectors of the economy as this indicates an element of a dysfunctional economic system.
“While we commend the CBN for these interventions, we caution that more investment should be made in critical infrastructure to ensure the repayment of these facilities.
“One major challenge in Nigeria’s export chain is the unstructured procedures that cause delays, corruption, and rejection of exports,” the statement reads.
“These facilities should be well directed to process targeted products in which Nigeria has some comparative advantage such as sesame, cashew, cocoa into finished goods.
“The reason for the low FX revenue from exports is due to the export of primary unprocessed commodities.”
“Nigeria must take bold steps to establish a trading system that supports the seamless flow of trade.
“It must establish the necessary infrastructure, create needed awareness toward exploring the African Continental Free Trade Area (AfCFTA).”
The LCCI DG, however, urged the CBN to exercise caution in its interventions in various sectors of the economy as this indicated an element of a dysfunctional economic system.
She noted that under the CBN’s targeted credit facility, the apex bank had intervened with more than N2 trillion support to agriculture.
