Governor of the Central Bank of Nigeria (CBN), Mr Godwin Emefiele, has revealed that the apex bank has so far distributed about $3 trillion to households, Small and Medium Scale Enterprises (SMEs), smallholder farmers, pharmaceutical companies as a buffer against the impact of the Covid-19 pandemic.
Speaking in an exclusive interview with Arise TV on the sidelines of the Intra-African Trade Fair, 2021, holding in Durban, South Africa, Emefiele noted that the insinuation that the CBN was overreaching its statutory bounds, was baseless, explaining that the bank had continued to play its monetary role effectively.
He pointed out that the job of the CBN was to complement the efforts of the fiscal side, emphasising that it had never happened in the country where the bank will lend funds for a tenure of 10 years with a two-year moratorium, like the CBN had done in recent times.
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“And I can tell you this, between 2020 and now, our data shows that we have disbursed at least N2 trillion, almost N3 trillion in loans to households, to Micro, Small and Medium Enterprises, to smallholder farmers, to pharmaceuticals and health institutions.
“We have also given these funds to some of our large agricultural companies that want to get back again to business, to manufacturing companies who are accessing long term 10 years loan with two-year moratorium with single digit rate. I have data that shows we are playing our part,” he said.
Emefiele also reiterated that the monetary policy and fiscal policy were working hand in hand to grow the economy.
He noted that with every developmental policy and initiative from the Presidency, the CBN and its fiscal counterpart, the Ministry of Finance, collaborate to achieve set goals.
He added that the new financial instrument, “The 100 for 100 PPP – Policy on Production and Productivity” would aid President Muhammadu Buhari’s vision to create 10 million jobs.
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He said: “If you ask Finance Minister, we are always in contact and she would tell you that there are no issues about the relationship between the Monetary and Fiscal authority. So, when people say there is no synergy, again, I wonder where that is coming from.”
“When COVID hit, Mr. President tasked the finance minister and I to work together to bring an immediate response and I went back to the Bankers Committee to which we came up with immediate response. And the Minister of Finance and I had opportunities several times to go back to brief the President. So it is left for you to respond whether there is collaboration between monetary and fiscal authority there.”
“Secondly, after that, the President said that we should establish economic sustainability program (ESP) chaired by the Vice President. The central bank played an active part in the development of that program to the extent that the fiscal authorities were only meant to contribute N500 billion and monetary authorities were left to provide almost about N1.5 trillion. Please let me correct this not as grant but as loans to support people who were impacted by COVID-19 so they can get their businesses back.”
Speaking further, he said: “Our job is to compliment and that is why after every why at every opportunity when we hold a monetary policy committee meeting, we read out what we have done to compliment the efforts of the fiscal, and data is there.”
Furthermore, on what the CBN had done to cushion the economic effect of Covid-19 pandemic, he added the bank had disbursed loans close to N3 trillion to household and businesses since 2020.
He said: “I can’t tell you this, in 2020 till date our data shows that we have disbursed close to at least N3 trillion in loans to households, to micro small and medium enterprises, to smallholder farmers, to pharmaceuticals and health institutions. Also, to some of our larger agricultural companies that want to get back again on to business, to manufacturing companies who are now accessing long term 10-year loans with two year moratorium at single digit rate.”
Further on the recent “100 for 100” policy, he said: “Again, the 100 for 100 is another program that came up out of the need to say that we must support more, do everything to create employment for our people. And that’s why if you read the framework, we said employment, we said we must see measurable level of employment that would be provided by that projects.”
“They have to be new projects and the central bank will do everything possible to provide foreign exchange to import plants and machinery. And by the time the plant or machinery are set up, import of raw material would be near zero so that we can begin look at our available local raw material, rather than importing them.”
He added: “It is meant again to compliment what Mr. president said that we had to create 10 million jobs in 10 years.”
According to him, “It is time for Nigeria to stop relying on a country or economy dependent on oil and we must diversify the economy into the non-oil sectors of our economy. We must deepen our economy so that we can truly position ourselves as a country that is self sufficient. Self sufficiency has to do with what we talk about in the economy of import substitution, industrialization, which is produce to feed yourself, and then export.”