Business
BoI and IFC Collaborate to Enhance Access to Finance and Export Credit in Nigeria
BoI and IFC Collaborate to Enhance Access to Finance and Export Credit in Nigeria
The recent partnership between the Bank of Industry (BoI) and the International Finance Corporation (IFC) marks a significant step towards bolstering Nigeria’s industrialization efforts by improving access to finance and export credit. Dr. Olasupo Olusi, the Managing Director of BoI, emphasized the importance of this collaboration during the BOI-IFC Conference on Empowering Futures in Lagos.
The conference served as a platform to foster innovative ideas and initiatives aimed at enhancing access to finance, export credit, partial credit guarantees, and other risk-sharing financing structures. Dr. Olusi highlighted the critical role of development banks such as BoI and multilateral financial institutions like IFC in expanding their risk appetite through unconventional financing approaches, particularly in light of Nigeria’s current macro-economic landscape.
The visit of IFC’s Regional Vice President for Africa, Sergio Pimenta, and his team to Nigeria underscored IFC’s steadfast commitment to supporting the development of Africa’s largest economy. This event also reinforced the strong bond between the IFC and development finance institutions (DFIs). Furthermore, the conference sought to devise a coherent and actionable plan to propel Nigeria’s industrial growth in alignment with President Bola Ahmed Tinubu’s ‘Renewed Hope Agenda.’
In his keynote address, Pimenta highlighted IFC’s substantial investment portfolio in Nigeria, amounting to $2 billion, making it the second largest in Africa. These investments are primarily concentrated across trade finance, manufacturing, financial markets, and infrastructure. He outlined IFC’s strategic objectives in Nigeria, which focus on supporting diversified growth, enhancing inclusion, promoting sustainability, and fostering job creation.
Pimenta also emphasized the IFC’s efforts to facilitate universal energy access, promote green energy adoption, improve access to finance for micro, small, and medium-sized enterprises (MSMEs) through financial intermediaries, and support agribusiness and manufacturing to enhance food security, meet domestic needs, and drive export growth. Additionally, he underscored the pivotal role of the Nigerian financial sector in supporting trade, financial inclusion, and access to finance for MSMEs.
The discussion then shifted to Nigeria’s infrastructure gap, with Pimenta highlighting the urgent need for infrastructure development in light of the country’s rapidly growing population, projected to nearly double to 400 million by 2050. This demographic trend, coupled with urbanization, underscores the critical imperative for infrastructure development to support Nigeria’s future growth and development.
Furthermore, Pimenta emphasized the significance of investing in agribusiness, citing primary agriculture as a cornerstone of Nigeria’s economy, contributing 23 to 24 percent of GDP and employing 36 percent of the labor force, the largest across all sectors of the economy. Despite this, Nigeria remains a net importer of food, with an annual import bill of approximately $10 billion. Pimenta stressed the transformative potential of agribusiness, offering opportunities for food security, employment generation, and economic diversification.
As Nigeria’s population continues to expand, localizing food production becomes increasingly vital, not only for ensuring food security but also for providing employment opportunities and sustainable incomes. Pimenta’s remarks underscore the critical role of agribusiness in Nigeria’s economic development and the potential it holds for driving positive socio-economic change.
In conclusion, the collaboration between the BoI and IFC represents a significant stride towards advancing Nigeria’s industrialization and economic development. The insights shared at the BOI-IFC Conference on Empowering Futures underscore the commitment of both institutions to fostering sustainable growth, promoting financial inclusion, and driving innovation in the Nigerian economy. As the partnership between BoI and IFC continues to evolve, it is poised to play a pivotal role in shaping Nigeria’s economic landscape and contributing to its long-term prosperity.
