ELAN commends government on economic recovery plans

The Equipment Leasing Association of Nigeria (ELAN) has lauded the Federal Government over the recently released three-year Economic Recovery and Growth Plan (ERGP).

According to the association, the plans, which are intended to take the economy out of the current recession, is indeed timely and reflects government’s proactive measures to tackle the current challenges, as well as grow the economy.

It noted that the policy to increase export earnings and government revenues by additional N800 billion ($2.63 billion) a year, is a welcome idea as this would further enhance our foreign exchange reserves and stabilise the Naira.

In the agriculture sector, the group said the target of self-sufficiency in rice and wheat by 2018 and 2019 respectively, as well as being a net exporter of rice, cashew nuts, groundnuts, cassava and vegetable oil by 2020, would further boost our food security plans, when executed.

The Executive Secretary of the Association, Andrew Efurhievwe, however noted that “equipment leasing plays a strategic role in economic development, and would be very relevant in the achievement of these set out policy initiatives.

Specifically, leasing will play an important role in the economic recovery process by enhancing the activities of the value chain in all sectors of the economy, thereby facilitating employment generation and wealth creation”.

“Leasing has been used globally by developing countries to enhance growth and development including the Micro, Small and Medium Enterprises (MSMEs) sector, which is the engine of growth of any economy.

“No doubt, the provision of capital assets is crucial to the success of any productive venture, and in our peculiar circumstances, it is imperative that reasonable access to credit is at least guaranteed. A major way of achieving this is through equipment leasing, a financing option that can be utilised for the purpose of enhancing capital formation”, he said.

He noted that in promoting agricultural sector and exports, leasing can give players the unhindered access to the requisite farm machineries such as tractors, ploughs for mechanised farming, which would in turn lead to enhanced yield and as well creating more jobs.

Also, in manufacturing, telecommunications, transportation and even infrastructure development, leasing has the capacity to facilitate the desired transformation, for the benefit of the MSMEs and the nation at large.

The opportunities leasing gives is very apt, much more at such times when government is canvassing the promotion of made-in-Nigeria goods, to further enhance our export potential and stabilise the economy.

But the Chairman of the group, Chuka Onwuchekwa, pointed out that some of the benefits of leasing are cash management/cash considerations; flexibility and convenience; obsolescence hedge; less restrictive form of financing; end of term options; absence of collateral/security; favourable financial reporting amongst others.

He reiterated that leasing has been supporting national economic development, contributing about N4.83 trillion to the economy in the past 15 years.

It is expected to even achieve more with the present realities in the economy where outright purchase is becoming difficult, especially to the MSMEs.

He assured that ELAN is willing and prepared to partner government and other stakeholders for the utilisation of leasing, to enhance wealth creation and value contributions to the Nigerian economy.