Posted by By ISAAC ANUMIHE, Abuja on
With $18 billion Nigeria's external reserves, Nigerians can now import freely for over 11 months, just as the Nigerian Export and Import Bank (NEXIM) Bank vowed to reduce its interest rate to a single digit.
With $18 billion Nigeria's external reserves, Nigerians can now import freely for over 11 months, just as the Nigerian Export and Import Bank (NEXIM) Bank vowed to reduce its interest rate to a single digit.
The West African Monetary Zone (WAMZ) has also appealed to governments in the sub-region to remove subsidies on goods and services.
According to Central Bank of Nigeria (CBN) Monetary Report for December 2004, the $18 billion external reserves Nigeria has give the country the leverage to freely import goods for 11 months.
The report also stated that foreign exchange sold to authorised dealers downed by 2.5 per cent to $668.93 million from $686.02 million in November. Similarly, world crude oil output overshot the estimated 83.55 million barrels per day with a marginal increase of 0.58 million barrels per day.
However, the governors of central banks in WAMZ insist that people should pay for any services they enjoy as this would enhance the private sector's ability to serve as truly the engine of growth of the economy.
As the European Union has approved 500 million Euros for water and sanitation projects in some African and Carribbean countries, Nigeria is now qualified for economic and trade benefits of the United States African Growth and Opportunity Act (AGOA) following the government‘s economic policies.
In a statement, the Managing Director and Chief Executive of NEXIM Bank, Alhaji Baba Yusuf Ahmed said that the bank has a responsibility to support the export sector through the provision of long-term and cost-effective financing.
He insisted that the maintenance of high interest rate has contributed negatively to export financing in Nigeria, adding, however, that NEXIM was considering bringing down its interest rate by applying the principle of economies of scale where it will keep overheads constant against increased volume.
This step, he said, would invariably lead to a drop in fixed cost per unit while still returning some profits.
"The volume which will help in this calculation will be achieved through the injection of more funds through recapitalisation of the bank," he said.
According to Ahmed, NEXIM would therefore require in excess of N40 billion while the bank plans to support the Federal Government's annual 10 per cent non-oil export growth rate target.
NEXIM is a Federal Government-owned bank with a shareholding of equally subscribed to by the Central Bank of Nigeria (50%) and Ministry of Finance Incorporated (50%). The bank was established by Act 38 of 1991 to replace the defunct Nigerian Export Credit Gurrantee and Insurance Corporation.