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Exporter seeks single digit interest rate for non-oil export businesses

An exporter, Mrs Adaku Chidume-Okoro, on Tuesday in Abuja, appealed to the Federal Government to initiate policies aimed at promoting single digit interest rate for non-oil export businesses.

Chidume-Okoro, who is the Group Managing Director of Gum Arabic Company Nigeria (GACON), said that it was imperative to boost export and successfully diversify Nigeria’s economy.

The exporter listed access to funding, high interest rate, infrastructural challenges, timing, climatic conditions as major challenges affecting export.

“So, all these put together, we look at funding or financing for export business at single digit interest rate.

“Funds at 20 or 30 per cent interest rate can’t definitely support or help non-oil export business.

“This is why a lot of bankers shy away from financing non-oil export business because they see it as a very high risky venture,’’ she said.

Chidume-Okoro further urged the Central Bank of Nigeria (CBN) to give grants to Small and Medium Enterprises (SMEs) without collaterals and de-emphasise finished products for non-oil export.

According to her, the CBN should correctly categorise the products in its RT 200 to ensure that SMEs are not cut off in the process.

CBN RT200 is an incentive grant the apex bank recently rolled out to support non-oil exporters and encouraging them to repatriate their money into the country and get a certain percentage paid to them as an incentive.

“But in doing that, they have technically cut off the SMEs by focusing on those that are exporting finished products.

“Those that are exporting the finished products is just 20 per cent of the non-oil exporters. Most of the non-oil exporters are the SMEs.

“So, CBN should correctly categorise the products,” she said.

According to her, farmers harvest their produce, wash them using the traditional method, slice and sun dry and bag and sell to exporters through a middle man.

“So, at each point of this processing it involves value addition and they are spending money and labour before it is exported.

“And then somebody decides to call it a raw product, it is not; that thing is a minus to the non-oil export sector.

“So unless it is properly addressed, SMEs are going to get disenfranchised and most of them are going to drop off from the non-oil export sector,’’ she said.

While seeking grants that would upscale SMEs to mechanisation, Chidume-Okoro said that Nigeria should avoid a process that should put people out of job.

“Yes mechanisation is good but already we are having huge unemployment, so we can’t allow the little jobs that are being provided to get lost.

“If we allow that, it will cause women and youths to go out again into the job market and be stranded.

“The Federal Government should deemphasise finished products for non-oil export.

“Most of what is being exported out of Nigeria are semi -finished products and they are creating job opportunities,’’ she said.

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