President and Chairman, Board of Directors of African Export-Import Bank (Afreximbank) Prof. Benedict Oramah said African governments need to accelerate the creation of the African Central Bank that help champion a continent-wide institutional reforms that will support an integrated banking and financial system.
He proposed the creation of a Domestic Financial System (DFS) which he said would allow the continent develops, prosper and earn respect from the comity of nations instead of constantly begging for aids and Foreign Direct Investment.
The renowned world economic expert suggested that the Headquarters of the Africa Central Bank should be situated in Nigeria, and should support the AU Champion for Financial Institutions in accelerating this project.
Prof. Oramah spoke as Guest Lecturer at the 2023 Chartered Institute of Bankers of Nigeria (CIBN) Annual Lecture with the theme: “Unlocking the Constraints to Africa’s Economic Transformation: Insights into the Power of Capital’’.
The continent he said “may be rich in natural resources, however, leveraging that wealth is determined by those who control the capital required to bring them to market.
He said: “it is, therefore, important that we build a Domestic Financial System that welcomes foreign banks but which, as a deliberate policy, must have the strong participation of Africa owned banks.’’
The Nigerian born economist affirmed that there was a need to welcome foreign banks and financial entities, the space, however must not be completely ceded to them if we (Africans) hoped to drive development in our desired direction.
Whilst he lamented that over decades after independence, Africa still begs for loans, he explained that the continent had about 500 billion dollars, about half of Africa’s external debts today, stashed away in foreign banks but the same countries of African could not borrow from the same foreign banks holding the resources.
On his part, Chief Executive Officer of Zenith Bank, Dr Ebenezer Onyeagwu said “Africa needs to wake up. Nobody knows Africa other than Africa, Nobody will take risks in Africa other than Africa, and nobody will know the corners other than us, Africans.
“I think he (Oramah) brought before us a huge challenge in a way, he took a swipe on the banking industry as a major anchor for accumulation and circulation of capital.
“But, I think the banking industry will not be doing this on its own; we need the cooperation of all the stakeholders to achieve this,’’ Dr. Ebenezer added.
Also, President and Chairman of CIBN, Dr Ken Opara opined that unlocking the constraints to Nigeria’s economic transformation would certainly impact the entire continent as the country was considered Africa’s biggest economy,
“Currently, Nigeria is considered Africa’s biggest economy, and this is why some people believe that Africa’s chances of prosperity completely lie in the hands of this country.
“As economies around the world continue to struggle with the impact of the COVID-19 pandemic, soaring food and energy prices, surging inflation, debt tightening, climate change, etc., unlocking the constraints to Nigeria’s economic transformation will certainly impact the entire continent.
