The Central Bank of Nigeria (CBN) has launched a program targeted at improving the production and exportation of agricultural commodities in the country, on the back of approval from the Bankers’ Committee to commence the Exports Facilitation Initiatives (EFI).

The initiative is in line with the effort of the Nigerian government, to inspire growth in the non-oil sector of the economy and focuses on five focal cash crops – cocoa, cashew, palm oil, Shea and sesame seed, the apex bank revealed in a circular dated June 13, 2019.

The CBN explained further that funding will be provided for the commodities under the approved guidelines of the Agri-Business small and Medium Enterprises Investment Scheme (AGSMEIS), the Non-oil Export Stimulation Facility (NESF), and the Real sector Support Facility-Differentiated Cash reserves requirement (RSSF-DCRR) in line with the approved limits in the Export Facilitation Initiatives Funding Framework (EFIFF).

The interest rate on funding according to the circular for the initiative is, nine percent which cuts across all categories in cocoa, oil-palm, cashew, Shea and sesame seeds production and exports, while the tenors vary for all categories of facility A and B.

The current administration has as one of its key objectives, the development of the non-oil sector of the economy by introducing several initiatives to address challenges. This includes smuggling and limited access to funding, both of which have hindered growth over the years.

We recall that the previously, the Nigerian President Muhammadu Buhari instructed CBN to blacklist any firm, including its owners and top management, caught smuggling or dumping any of the restricted 43 items into Nigeria. According to the apex bank governor, Godwin Emefiele, the presidential directive was aimed at stopping palm oil importation as well as providing support to firms and individuals that want to expand the production of ten different commodities in Nigeria – rice, maize, cassava, tomatoes, cotton, oil palm, poultry, fish, livestock dairy and cocoa.

Meanwhile, the Bankers Committee had in April earmark a credit facility of N200 billion to companies producing any of the selected five cash crops earlier mentioned. The loans will be extended at single digit interest for a tenor period of ten years.