In its effort to enhance industrial growth of the nation’s economy, the Bank of Industry (BoI) has approved loans and investments worth N58 billion to 675 enterprises, 96 percent of which are for micro, small and medium enterprises (MSMEs). Achike Udenwa, minister of commerce and industry, who disclosed this on Tuesday in Abuja at 2009 ministerial press briefing, also revealed that the Federal Government has released to BoI N10 billion, part of the N100 billion proposed to resurrect the ailing textile industry.
The bank, according to the minister, has been able to expand its operations without compromising the quality of its risks assets as evidenced by its portfolio at risk (PAR) that declined from 65 percent in 2005 to less than 21 percent in 2009.
While commending the development impact of the bank’s operations, Udenwa noted that the number of jobs created by its assisted companies grew from 150, 000 in 2005 to more than 815, 000 in 2009. He observed that the bank’s recent performance was driven by paradigm shift which include allocation of 85 percent of its resources to financing MSMEs that utilise local raw materials, especially agricultural produce and have high employment generation and export potentials.
Other paradigm shifts that enhanced the performance of the bank include promotion linkages between MSMEs and those promoted by women, as well as deepening the bank’s credits delivery process by lending to cooperative groups under collective guarantee arrangement and the establishment of micro finance banks, he said.
Speaking further on the release of the textile fund that is to be disbursed by the bank, the minister noted that BoI has assumed the management of cotton, textile, and agreement scheme as well as the rice processing development fund set up by government to grow the two sectors in which virtually all parts of Nigeria have comparative advantage that could be efficiently converted to competitive advantage.
Udenwa also disclosed that the country has realised through non oil exports, the first nine months of 2009, the sum of $900 million as against $1.8 billion and $1.9 generated from the sector in 2007 and 2008, respectively.
The minister, who believed that the sector could have generated more than what was realised in the three quarters of 2009, lamented that low standard of the Nigerian export products has been a hindrance. He, however, said the Nigerian Export Processing Council (NEPC), the agency saddled with the responsibility of promoting the country’s products, in collaboration with Standard Organisation of Nigeria (SON) and NAFDAC has intervened to improve the situation.
The minister explained that NEPC has also partnered with NEZIM Bank to provide some relieves to the exporters by connecting to cheap source of export finance as part of the effort to address the prevailing problems of non access to fund. Udenwa said the Federal Government is making frantic effort to ensure that cement is within the reach of the common man by ensuring drastic reduction in price comes next year.