Mr. Godwin Emefiele, governor of Central Bank of Nigeria (CBN) is not relenting in his drive to give rise to Nigeria’s economic growth through legacy projects.
Has disclosed last week that the apex bank would set up an International Financial Centre (IFC) to be operational in the second quarter of 2022, and that the regulator under his watch is committed to opening up the economy for growth.
This is even as the infrastructure company (InfraCorp) being created by the CBN, African Finance Corporation (AFC) and the Nigerian Sovereign Investment Authority (NSIA) to raise N15 trillion is set to take off in February with N1.5 trillion investment in three infrastructure projects across the country.
An IFC is a centre operating from a physical location that facilitates international activity and operates under a regulatory framework that meets international norms. IFCs provide financial services to international clients as well as support services such as law, accountancy and technology.
The centre has to be attractive to businesses not operating in the jurisdiction and meet a number of inter-related requirements, mainly relating to stability and resources.
Emefiele, who was delivering a keynote address at the 56th Chartered Institute of Bankers of Nigeria (CIBN) annual dinner in Lagos, explained that the facility is expected to serve as a hub for attracting domestic and external capital which is much-needed to strengthen the Nigerian economy post-COVID-19.
“The International Finance Centre when fully operational in the second quarter of 2022 will help to position Nigeria as a key destination for investment in Africa,” Emefiele added.
The CBN governor noted that a key challenge to supporting growth in key sectors of the economy was access to large pools of cheap investment capital.
According to him, most of over $100 trillion being held by institutional investors in Organisation for Economic Co-operation and Development (OECD) countries are invested in low-yielding assets relative to high-yielding opportunities in Nigeria.
“Leveraging the strength of the private sector will be critical in mobilising funds that are needed toward building a more resilient and stronger economy”, he said.
“We intend to strengthen collaborations with the private sector to support investments in critical sectors such as infrastructure, and ICT, in addition to ongoing efforts to build a stronger agriculture and manufacturing base in Nigeria.
“As a result, all efforts in 2022 must be made to ensure that we maintain our focus on improving access to finance and credit for households and businesses, mobilising investment to boost domestic productivity, enabling faster growth of non-oil exports, and supporting employment generating activities.”
A policy analyst, Tayo Fakiyesi, noted that the role of a financial system is to promote economic wellbeing through financial intermediation, acting as conduits of savings into investment, and the provision of financial infrastructure for effecting financial transactions.
According to him, in promoting the effective performance of this role by the financial system, the governments, regulatory authorities, as well as regulations in place are very pivotal.
He said, “The role of government must be enabling with minimum and only necessary controls.
“Such government involvement in the financial system must be reduced to the minimum, except where the private interests of financial market participants do not align with the public interests as well as for reasons of competitive fairness or commercial viability.”
