Business

There is good news for farmers and operators of Micro, Small and Medium Enterprises (MSMEs), as the Central Bank of Nigeria (CBN), has set up National Collateral Registry (NCR) to assist them obtain loans from financial institutions to boost their business, using movable assets as Collateral.

The apex Bank in collaboration with the International Finance Corporation (IFC), established the NCR, a financial infrastructure that will enable MSMEs to leverage on their movable assets (equipment, machinery, vehicles, keke-napep, crops, livestock, account receivables, inventories, jewelleries etc) as collateral for loans in their various banks.

Speaking at a town hall meeting in Benin yesterday, with the theme “MSMEs Safe Haven: Improving Financial Access to the Nation’s Main Economy Drivers”, the Registrar, National Collateral Registry, Mr. Bulus Zgabawa Musa, an Assistant Director of the CBN, said NCR was created in 2015 to deal with movable assets which financial institutions would accept as Collateral to guarantee loans for farmers and MSMEs operators.

Musa who was represented at the event by Dr. Xavier Itam Okon, explained that NCR provides information on all movable assets to banks to enable them reach appropriate decisions on giving loans to prospective clients.

“The message is that you can walk into any of your banks to take business loans, using movable Collateral or assets.

The event was organised by NCR in collaboration with Pro-Poor Growth and Promotion of Employment in Nigeria Program- Sedin of Deutsche Zusammenarbeit (GIZ).

Earlier, Mr. Olawale Afolabi of GIZ, told participants that what his organisation does is to assist prospective clients solve the problems of getting loans from financial houses.

“What we do at GIZ is to look at the problems of securing loans from financial houses. We also teach how to prepare proposals, and support the Cassava value chain,” Afolabi said, adding that GIZ has been in Nigeria since 1974.

Participants at the event, especially those from the informal sector, were urged to think ahead for their retirement by saving gradually.

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The Nigerian House of Representatives has directed the Central Bank of Nigeria (CBN) to immediately suspend the sale of Polaris Bank Plc.

The Reps said the suspension should be until the CBN deposit Insurance Corporation and the Asset Management Corporation of Nigeria concluded all processes for open, transparent, and competitive bid process.

This, the house said it should be in line with best practice and procedure for divestment of this nature.

This followed the adoption of a motion of urgent public importance by Rep. Henry Nwauba (APGA-Imo) at the plenary.

He said public attention had been drawn through a circulation currently on social media in respect of the proposed sale of Polaris Bank for N40 billion.

He said that there was need to ensure that the divestment in the bank did not jeopardize the core reason for the CBN intervention in the bank in the overall public interest.

He added that the divestment should be done most transparently following the required due process.

He said that this was necessary to avert public outcry and untoward reaction from critical stakeholders in the economy, foreign business partners banking community, depositors, Correspondent banks.

He added that it was crucial to avoid the shortcomings of the previous similar exercise undertaken in the past

He said that Polaris Bank was borne out of the bailout of the defunct Skye bank Plc that failed due to poor corporate governance and non-performing loan.

This, he said, was for which close to a trillion Naira of public fund was committed to resuscitating the bank.

He said that the proposed sale was shrouded In secrecy and was opaque and required that it was done in transparency and accountability to eliminate insinuations of corruption.

He said the transited defunct Skye Bank was a systemically important Bank with a large pool of employees, customers, and other stakeholders.

He said that the bank without a bailout would have had a serious contagion effect on the economy and global perception/reputation;

The House therefore set up an Ad hoc Committee to within 20 days, review the total outlay by the Federal Government of Nigeria in Polaris Bank and account for the entire financial input in the bank by the Federal Government.

The House said this should be through CBN, NDIC and AMCON to determine whether the conditions and terms of sale were likely to ensure positive return on public funds thus far committed to the bank, whether as bailout funds or other investments.

The House urged the committee to take action necessary to ensure that the public funds committed to Polaris Bank were appropriately documented, accounted for.

The Small and Medium Enterprises Development Agency of Nigeria (SMEDAN), has hailed the inauguration of Association of Certified Business Development Service Providers of Nigeria (ACBDSP).

The Director-General of SMEDAN, Olawale Fasanya, described it as a welcome development, adding that the association would deepen the practice of business development services in Nigeria.

Fasanya said this on Tuesday when the Board of Trustees (BOT) and members of the ACBDSP visited him in Abuja.

The SMEDAN boss reiterated the objectives of the BDSP programme in Nigeria, saying that the Federal Government plans to achieve a more effective Small and Medium Enterprises (SMEs) sector through it.

While pledging SMEDAN’s commitment to collaborate with the new association, Fasanya tasked all certified Business Development Service Providers (BDSPs) to work hard under the umbrella of ACBDSP.

According to him, this is to bring value to the SMEs in Nigeria and to promote the growth of the sector.

Fasanya further urged the association to drive the commitment of its members toward the shared goals.

He assured the association of SMEDAN’s readiness to support to promote the development of SMEs in the country.

The Chairman BOT, ACBDSP, Stanley Muoneke, commended SMEDAN for the foresight and support during the formation of the association as well as its continued efforts to develop the Micro Small and Medium Enterprises (MSMEs) sector in Nigeria.

Muoneke also hailed the leadership role played by the Enterprise Development Centre of the Pan Atlantic University as well as Kaduna Business School.

He said that the ACBDSP aimed at build a community of professional BDSP practitioners who define excellence and advance ethics for the business development service Providers profession and practice in Nigeria.

“Going into the future, SMEDAN and ACBDSP expect to work closely together on key projects aimed at bringing value and growth to the MSMEs sector in Nigeria,’’ Muoneke said.

The News Agency of Nigeria reports that BOT members of the ACBDSP include Prof. Helen Andow, Dr Dahiru Sani and Hajia Raliat Oyetunde.

Others are Mike Alade, Helen Emore, Ibrahim Buwanhot and Onaifo Uwa. It would be recalled that in 2018, the Federal Government through SMEDAN, set up a national framework for the accreditation and certification of business development service providers.

It aims at setting the standard for business development interventions by certifying a mark of quality for the delivery of business development services to the MSMEs in Nigeria.

BDSPs, who go through training and accreditation process attain the standard benchmark for business development services interventions.

They become certified and assist MSMEs in strategy, performance, competitiveness as well as facilitate access to finance therefore directly contributing to the country’s economic development.

The ACBDSP was formed and incorporated by the certified BDSPs in April 2022 as a platform for advancing professional practice of BDSPs in Nigeria.

It acts as springboard for members to exchange ideas, accelerate business growth, strengthen practical knowledge, drive common standards, and enhance client relationships.

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SMEDAN DG, Olawale Fasanya has encouraged MSMEs to adopt innovative packaging and branding to ensure their products remain relevant in the international market.

The Director-general of the Small and Medium Enterprise Development Agency of Nigeria (SMEDAN) Olawale Fasanya,, made this statement in Abuja, at the implementation of packaging and branding programme for small and medium enterprises (SMEs) products on the Africa Continental Free Trade Area (AfCFTA).

Fasanya said SMEDAN intends to push Nigeria’s export target further to $35 billion over the next five years through sustained and vigorous implementation of the packaging and branding programme for SMEs.

According to him, Nigerian businesses must wake up and begin to think and act creatively, become measured risk takers, and problem solvers.

“They must also pursue the highest standards attainable in production and service delivery so as to remain relevant in the international market,” he said.

“One of the challenges confronting Nigerian exports is rejection and under-pricing of their products in the international market,” the SMEDAN boss said.

“Some of the reasons adduced for this trend include poor product quality, poor packaging and branding, lack of information on the nature and dynamics of global market and disregard for basic requirements.

“Others are inadequate policy arrangements between Nigeria and export-destination countries and delays at the Nigerian ports leading to expiration of the product shelf life or depreciation of product value.”

Fasanya further noted that innovative packaging protects products along the value chain and provides essential information about the maker and the exporter.

It is also essential for cleaner, more convenient product presentation and less susceptible to losses from theft, evaporation, spilling, spoilage and damage while innovative branding offers ease of product identification and enhances corporate image among others,” Fasanya added.

The director-general further highlighted high export trade as a catalyst for sustainable economic development, adding that through export trade Nigeria earns vital foreign exchange, increases her revenue base, foreign reserve and avoids trade deficit.

“The Observatory of Economic Complexity (OEC) once ranked Nigeria as the 49th largest export economy in the world, having exported goods worth $47.8 billion and imported goods worth $39.5 billion,” he said.

“Nigeria’s non-oil export is projected to hit $25 billion by 2025, from $2.7 billion in 2022, according to the Nigerian Export Promotion Council (NEPC),” he said.

Fasanya added that the programme would increase the number of SMEs that would meet AfCFTA standards as well as enhance cluster development and improve common processing facilities and value addition.

Numbers published in an audit report by the Nigeria Extractive Industry Transparency Initiative (NEITI) suggest a significantly healthy China and Nigeria bilateral relation. At least, the country’s mining sector gives a glimpse of it.

Data sourced from NEITI, a transparency watchdog, showed companies owned by Chinese nationals are the largest mining companies in Africa’s biggest economy.

The NEITI’s report showed mining activities in Nigeria in 2020 were carried out by 102 companies. Information about beneficial ownership was provided for 65 of these companies.

Details of ownership show that 28 of them were owned by Chinese nationals. This means 43.08percent of the companies that mined minerals in 2020 were owned by Chinese nationals.

Further insight showed Nigerians owned 23 of these total 102 companies. The companies owned by Nigerians made up 35.38 percent of the total that mined minerals in 2020.

Beneficial ownership of other companies showed Lebanese owned 3 of these companies, and two were owned by Germans. One company was owned by an Indian, a Liberian, and an American.

The NEITI also showed that 102 companies produced 64.61 million tons of 38 different minerals. The top five minerals were limestone, granite, sand, laterite, and clay.

Production output by the company’s national ownership shows companies owned by Nigerians produced the highest output in 2020. These companies were able to produce 33.49 million tons of mineral products in the year. These made up 51.85percent of the total mineral output.

Companies whose owners were not specified produced the second largest output in the year. Their output, which amounted to 21.39 million tons, comprised 33.12percent of the total output.

The Chinese company produced the third largest output in the year. These companies produced 4.24 million tons of mineral products, accounting for 6.57percent of the total.

German and Lebanese-owned companies produced the fourth and fifth largest output. 3.46 million tons were produced by German-owned companies, while those owned by Lebanese produced 1.45 million tons.

The market value of these minerals as of 2020 summed up to N120.49 billion. Of these, the minerals mined by Nigerian companies were N28.76 billion. This was 23.87percent of the total market value.

Those whose owners were unknown were valued at N76.81 billion, comprising 66.24percent.

The Chinese-owned companies placed third behind those by Nigerians. These companies produced output valued at N5.68 billion, comprising 4.71percent of the total market value.

However, China was the primary benefactor of the output from the mineral sector in 2020. The total export volume in 2020 was 32,992 tons from 30 different minerals. Out of this, 26,550 tons of these were exported to China. This represented 80.48percent of the total export volume.

This means other countries with export destinations received 19.52percent of the 32,992 tons exported.

Inside details of China’s link in Nigeria’s mining sector

The export value shows that 85.07percent of the $42.46 million in exports went to China. China’s export value of the mineral product in 2020 was $32.12 million. The other countries exported 14.93percent of $42.46 million worth of mineral products from Nigeria in the year.

A report by KPMG, a multinational professional services network, and one of the Big Four accounting organisations showed despite the widespread economic impacts of the coronavirus in 2020, Nigeria’s mining sector exceeded the budgeted revenue of the Federal Government (FG) in 2020 by about 10 percent (N2.09billion as against N1.9billion).

The sector also increased its contribution to the Nation’s Gross Domestic Product (GDP) by about 23percent in 2020.

Despite its huge potential, researchers at CSL Stockbrokers warned that illegal mining activities had continued to wipe gains in the sector.

They said, “Despite the endowment of mineral resources in Nigeria, the solid minerals sector has significantly underperformed with a meagre contribution of less than one percent to the GDP over the years.

“The figure is, however, solely from formal channels as the artisanal and small-scale mining activities that constitute over 80 percent of the current mining activities in the country are unaccounted for.”

This is where Nigeria’s mining problem lies. Nigerians, noted the Capstone report, have practised informal artisanal mining for centuries.

It said, “Today, the activity is largely poverty-driven and supports the livelihoods of at least 500,000 people. Partly due to its informality, artisanal mining is associated with many negative externalities such as environmental degradation, crime and health hazards.

“One tragic example is the 2010 lead poisoning outbreak in Nigeria’s northwestern Zamfara State, which killed approximately 400 children and has affected thousands more.”

Job creation is another benefit Nigeria is missing out on by leaving the sector underdeveloped.

Australia has about 320,000 direct jobs attributable to the mining sector, while over 200,000 jobs have been created in Canada through the mining sector.

Nigeria, rich in over 34 solid minerals, has over 23 million of its citizens with no jobs.

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