The Manufacturers Association of Nigeria (MAN) has asked the Central Bank of Nigeria (CBN) to work towards reducing the number of Bureau De Change (BDC) operators and develop a sustainable framework to guide credit intervention to the manufacturing sector.
The group made the call through its President, Otunba Francis Meshioye while delivering a speech at the MAN Reporter of the Year award ceremony.
According to him, the need to reduce the number of BDCs is premised upon the reduction of their excesses and ensuring the proper structure of their operations.
Also, he called on the CBN to prioritize FX allocation to the sector and strategically guide remittances into the non-oil sectors like the manufacturing industry.
What he said
- “Prioritize forex and credit allocation to the manufacturers and reduce the number of BDCs into large and well-established operators to curb their excesses and untoward operations through effective management and supervision.”
- “The CBN to develop a sustainable framework to channel credit interventions into the manufacturing sector, outside the direct intervention. Additionally, it should mobilize commercial banks to intentionally provide long-term single-digit interest loans to the manufacturing sector to fast-track the actualization of a 1 trillion dollar economy”
Savings from fuel subsidy removal should go to the productive sector
Furthermore, the group’s President asked the federal government to direct savings from the fuel subsidy removal to productive sectors of the economy, encourage sub-national governments to leverage the Electricity Act to improve the power sector and patronize made-in-Nigeria goods on all its purchases and contracts.
What you should know
The call by the MAN’s President for credit intervention in the Manufacturing sector contrasts the position of the CBN leadership in recent times.
The Governor of the apex bank has at different fora stated the bank does not have the capacity for these interventions and cannot afford failed interventions after the previous administration spent around N10 trillion on such.
However, the bank seems to be moving in the direction of reducing the number of BDCs by pegging capitalization for tier-1 BDCs to N2 billion and promising to regulate their activities.
During the press briefing, while delivering the communique on the MPC meeting, the Governor of the CBN stated that the bank is moving to a very aggressive regulatory environment for financial service operators in the country.
