Nigerian exporters, many of whom are Small and Medium Enterprises (SMEs) got N24 billion credit facility from the Nigerian Export-Import Bank (NEXIM) within a year.
Disclosing this via a statement, the management of the bank said the money disbursed is part of the N55 billion loan applications it approved for the country’s exporters.
According to the bank, the approved loan application and disbursement is in tune with NEXIM’s ‘risk-bearing support’ for the country’s non-oil exports.
Why this matters: The role of SMEs in enhancing economic growth and development has, over time, been widely acknowledged globally. Economic wealth all over the world is created through enterprises and the expansion of their output.
[READ ALSO: NEXIM, SMEDAN sign pact to boost exports]
SMEs contribute to the economy by creating value through the production of goods and services, thus enhancing the Gross Domestic Product. They also generate employment by creating much-needed jobs in the economy, as well as expanding the export sector largely through linkages with large firms that produce for the foreign sector.
Lack of adequate funding has been one of the major challenges facing Nigerian SMEs. For a long time, entrepreneurs have lamented the lack of adequate provision of credit facilities. It is, therefore, a good thing that something is finally being done about the situation.
Prior to the disclosure of its provision of credit facility to exporters, NEXIM had concluded a pact with Small and Medium Enterprises Development Agency of Nigeria (SMEDAN). The partnership was to build synergy between the two institutions towards capacity building of Nigerian SMEs. This, NEXIM stated, would help to boost their contributions to exports and enhance formal trade.
[READ MORE: Nigeria’s top 10 exports in Q1 2019]
The partnership also aimed at promoting the export of locally manufactured products by Small and Medium Enterprises (SMEs).
What you should know: NEXIM is an export credit agency in Nigeria. The bank was established by Act 38 of 1991 as an Export Credit Agency (ECA) with a share capital of ₦50,000,000,000 (Fifty Billion Naira) held equally by the Federal Ministry of Finance Incorporated and the Central Bank of Nigeria (CBN).
NEXIM Bank replaced the Nigerian Export Credit Guarantee & Insurance Corporation earlier set up under Act 15 of 1988 to provide export credit guarantees and export credit insurance for exports of Nigerian commodities and services within and outside West Africa.
