AfDB’s fund for Nigeria will aid SMEs, says ACCI boss
As the African Development Bank Group, (AfDB) through its Trade Finance operations, has approved a US$14.12 million facility to support Nigeria’s membership in the African Trade Insurance Agency (ATI), the President of Abuja Chamber of Commerce and Industry (ACCI), Prince Adetokunbo Kayode, CON,. SAN has described the move as one that will make for the development of Small and Medium Enterprises (SMEs).
Adetokunbo, who stated this in a statement made available to newsmen in Abuja on Friday, stressed that when such funding is injected to the development of infrastructures such as transportation network, electricity, telecommunication, manufacturing and other related activities, such will directly impact positively on the SMEs.
The ACCI boss also said the initiative was well thought out as it seeks to ensure that Nigeria benefits from gross political and commercial risk insurance cover on total investments and trade amounting to over US$ 5 billion by 2020 pointing out that the trickle down effect of such inflow will be tremendous.
“The funding mechanism of the SMEs in Nigeria is not designed to work. Commercial banks are not out to give long term funding support to SMEs in Nigeria and that is where the money meant for the SMEs is channelled. This is not helping matters. That is why external funding to be deployed by AfDB is welcome.
“I have been advocating for a situation where the Organised Private Sector (OPS) such as ACCI will be charged with the responsibility of disbursing such funding to their members.
“It is much easier that way hence we know them and can easily securitise the loans for them instead of going through the present rigorous process which is not yielding any positive result.
“I therefore perfectly understand that, when Nigeria navigates through the processes to become a member of the ATI, the targeted approved facility will add impetus towards interventions aimed at building institutional capacity and improving the resilience of the Nigerian economy.
“Again, the need to join the ATI is another effort to make Nigeria, which is one of the critical economies in Africa to galvanise additional inflow finance trade and aids to trades as it bothers on importation of basic items such as medicines and communications equipment and move a step further by rehabilitating basic infrastructure and strengthening the country’s productive sector”, he said.
The President recalled that ATI’s mandate is to provide medium to long term credit and political risk insurance, as well as other risk mitigation products to its member countries and related public and private sector actors which he said this financing facility aligns with four of the bank’s high 5 priorities, namely: light up and power Africa; industrialize Africa; feed Africa and integrate Africa.