Against the backdrop of harsh indignities of persistent neglect visited on the non-oil export sector by successive governments, any plan to overcome the wilful policy lethargy inflicted on that vital sector would take more than mere mouthing the resolve of turning a new leaf. In essence, it would take clearly defined strategies, policy measures and political will to enrich the services and commodity species traded in export business.
This is the pathway to success for any regime that is resolute in determination to shore up dwindling revenue profile. Admittedly, the current regime can be scored as having graduated from just mere policy pronouncement in the business of diversification of the nation’s economy into vigorous articulation of policies and clearly spelt out action plans to expand the nation’s revenuee base. In very specific terms, for certain economic decisions, the fulcrum around which activities revolve in realizing referenced government policy objectives involve agencies that boast of the right calibre of experienced personnel with requisite technical and intellectual ability to drive the process?
This is where the swing of personnel composition and balanced inter-relationship between agencies with coordinate functions and supervisory role play vital role in showcasing the seriousness and commitment of the government. The Buhari regime has pushed forth a major policy thrust of diversification of the nation’s productive sectors.
As such, the current tenor of hyper activity in the Nexim bank is evidential of resolve, purpose and commitment to the business and concept of diversification, much as it also clearly underscores the formidable range of grasp that the current management headed by Adamu Bello has of the requirements of the nation’s economic growth exigency.
The line of the current management’s policy articulation and operational strategy for approximating to the demand of diversification is in sync with respectable world class opinion on nations hit by exigency of economic expansion. To this end Bello’s recent advice to the federal government to push for human capital development via increase of funding to the education sector, especially science and technology education, with an urgent review of our education curricular in order to promote entrepreneurship development is the global trend. Investment and research in cutting edge Technology and innovation in ICT and related disciplines count among the leading source of financial power and economic growth for nations that have initiated institutional mechanism to exploit the huge opportunities that exist in those sectors.
It is common knowledge that the Nigerian economy is heavily reliant on a monoproduct that has been pushing it through the rough patches of restricted growth. Following the collapse of oil price in the international market, it took just barely a year after the current regime came on board for the nation’s economy to slip into recession –precisely 2016 –which was reported as recording 5 consecutive quarters of negative GDP growth before it sluggishly recovered by the second quarter of 2017 after a slight improvement in the international price of oil. But the huge impact on the nation’s economic life had been felt which fuelled the impulsive resolve of the government to steer the economy away from massive reliance on oil and lay the foundation for sustainable economic growth and most importantly, to hedge against the volatility in the international price of oil.
The start-up point for the government and the current management of Nexim in the business of diversification is incontestably a difficult one because the nation has a terrible history of misplaced priorities. Beyond the initial hurdle of sizing up the challenges that inhibited the bank’s performance in the past and solution models for a new direction, the current drive is fastened on robust commitment to cut a clean break from previous era of lack of strategic plan, inadequate capitalization and paucity of operational funds required for the creation of new product lines consistent with government focus and policies. These are what hobbled the bank in the past from delivering on its mandate. The new management exploited the wisdom of pursuing concerted series of efforts that engage key stakeholders, the Ministry of Finance and the Central Bank of Nigeria (CBN), into activating necessary intervention Funds for its activities. Two of these funds readily come to mind which are the Non-Oil Export Stimulation Facility (NESF) and Export Development Fund (EDF).
By virtue of its obligation as an agency with defined mandate that is consistent with the current focus of the government, the bank stands out as a vital tool whose working relationship with clusters of interests and organizations –across the continent and beyond blends the fortunes and opportunities that abound in the non oil sector to facilitate government’s effort in steering the nation’s economic wheel from the destructive influence of monoproduct economy. With some modification on extant procedure, the CBN –inspired N500 billion Non-oil Export Stimulation Facility (NESF) reserved for export –oriented projects, has now admitted NEXIM as a Participating Financial Institution. This allows exporters to submit applications directly to NEXIM without the hassles of going through other banks as was previously practiced.
It is tempting to argue that the Nigerian economy is now well-diversified based on the data released by the National Bureau of Statistics (NBS) which indicates that the Oil & Gas sector accounts less than 10% of the Gross Domestic Product (GDP). This can only mean that the non-oil sector accounts for over 90%. However, the real test for the economy is the relatively high percentage of the services sector in the nation’s GDP which now hovers in the neighborhood of 55-60%, providing the basis for a valid conclusion that Nigeria is boldly stepping into the threshold of a developed economy which allows the manufacturing and services sector to take up larger share of economic activities. Inspiring as this changing configuration of sectoral contribution is, the missing link is that the change is not reflected in the export sector since oil and gas still dominate the level of export activity (95%).
This narrative of abnormality in the percentage contribution of export activity of the real sector is digressional to the diversification plan of the government and it is heart-warming that NEXIM is activating a strategic working plan to correct this trend. This timely intervention was disclosed recently by the NEXIM Czar- Bello, hinting that the bank has ingrained in its strategic working plan for the period 2018-2022 an arrangement which places emphasis on value addition of specific sectors with greater potential for creating jobs –Manufacturing, Agro –processing, Solid Minerals and Services.
This naturally fits into the economic growth and recovery plans of the current government which are thruster on growing export revenues and job-creation. His further reference to the larger objective of the government to make Nigeria the manufacturing hub for West Africa and the entire region via a strategic plan christened ‘Nigeria Industrial Revolution Master Plan’ showcases a robust harmony of parallel vision and functional relationship between the bank and other vital organs of government’s economic execution plans. The recent disclosure that the bank is set to promote export of services in professional areas like engineering & construction, creative economy, business process outsourcing & ICT as well as medical tourism/healthcare services completes the cogency of the economic revolutionary credentials of the Bello-led Management.
Yakubu writes in from Abuja
