CBN releases modalities to boost productivity, earmarks N5bn loan for investors
The Central Bank of Nigeria (CBN) on Tuesday released guidelines for its “Production and Productivity” initiative, through the “100 projects for EVERY 100 days” project.
Information in the apex bank’s website revealed that the initiative was designed to support the Federal Government‘s drive towards boosting productivity and economic diversification.
It stated that a maximum loan of N5 billion per obligor would be approved under the initiative, adding that any amount above N5 billion would require special approval of its management.
According to the apex bank, the facility is a long-term loan for the acquisition of plant and machinery, as well as working capital.
“The initiative will create the flow of finance and investments to enterprises with the potential to kickstart sustainable economic growth trajectory, accelerate structural transformation, promote diversification, and improve productivity.
“It is a support to private sector companies with the aim of reducing certain imports, increasing non-oil exports and to improve the FX-generating capacity of the economy,” it stated.
According to the CBN, the broad objective of the initiative is to reverse the nation’s over-reliance on imports by creating an ecosystem that targets and supports projects with the potentials to transform and catalyse the productive base of the economy.
“The specific objectives include: catalyse import substitution of targeted commodities; increase local production and productivity; increase non-oil exports; and improve foreign exchange earning capacity of the economy,” it stated.
It explained that comprehensive, regular monitoring of specific benchmarks and Key Performance Indicators (KPIs) under the initiative would be undertaken regularly.
“The KPIs shall include an increase in production output of financed companies; percentage increase in capacity utilisation and percentage increase in export volume and value.
“It would also include a decrease in import volume and value of industrial raw materials and increase in the number of jobs created,” the apex bank stated.
It added that focal activities shall be existing businesses and projects (brownfield) with the potential to transform and jumpstart the productive base of the economy.
“These include manufacturing, agriculture and agro-processing; extractive industries, petrochemicals and renewable energy; healthcare and pharmaceuticals, logistics services and trade-related infrastructure; and any other activities as may be prescribed,” the CBN stated.