By Roberts Orya
The other significance of the rebasing was its ‘revelation’ of the extent to which the Nigerian economy has diversified; with strong performances across a wide range of industries which were previously quite weak and had not been captured in the previous rebasing. The much diversified Nigerian economy that we now know is a product of assiduous pursuit of the economic diversification agenda. It is true that this has been a policy commitment of previous administrations. Thus we have in evidence policy continuity in Nigeria. However, President Goodluck Jonathan has provided unparalleled leadership and commitment to the execution of the economic diversification policy under his Transformation Agenda. Execution of the strategies encapsulated in the Agenda has been steady across his cabinet. This provided the yields in the strong performances of the sectors Mr. President has given particular support to including entertainment, transportation, manufacturing and housing as revealed in the GDP statistics that emanated with the rebasing to 2010.
I like to exemplify the importance of disciplined execution with my experience at Nigerian Export – Import Bank. NEXIM Bank is an institution that was set up by the Federal Government to execute its trade policy. In recent years, this policy has taken the direction of promoting export growth in the non-oil sectors of the economy and formalization of trade as its core objectives. Without a doubt, these objectives are capable of turning around the economy, given the country’s huge potentials. However, at institutional level, the lack of disciplined pursuit of its mandate and sustained execution of the trade policy goals of the government had ensured that when I assumed office five years ago, NEXIM Bank was a shadow of the important institution it was meant to be. Lax risk management which had resulted in significant impairment of its risk assets, poor corporate governance and poorly motivated staff profiled the bank to be ineffective in supporting the trade policy of the government and the aspirations of Nigerian exporters.
In response, I had to reunite NEXIM Bank with its institutional mandate and operational focus. These entailed a thorough audit of the Bank’s processes, people and risk management architecture. What ensued was a corporate transformation agenda that entailed institutionalization of corporate governance best practices, smart deployment of human capital and design of a risk management framework to support creation of risk assets. With this in place under the guidance of KPMG Professional Services, we had to refocus NEXIM Bank to what the trade policy objectives of the government have been. This was how we came up with the MASS Agenda acronym which readers of my essays are by now very well acquainted with.
NEXIM Bank has in the last five years focused on the Manufacturing, Agro-processing, Solid Minerals and Services sectors. A lot of our commitment and lending in these sectors have aimed to de-risk the sectors, provide information support and funding for businesses to enhance export growth and prosperity of Nigerian exporters. So doing, we have lent support to the brightening of our sectors of focus. In concrete terms, we have assisted a number of SME manufacturers who have recovered from the margins of their operations and are now tapping the export market. Across the “MASS” sectors, we have created and helped sustain over 27,000 jobs. Over $230 million has been earned in foreign exchange by the businesses, and NEXIM Bank has managed the entertainment industry fund. Against the pressure to operate the fund as a grant, which it is not by the policy that instituted it, the fund has made disbursements to deliver world-class infrastructure and production of creative and entertainment products.
The discipline of execution of our strategies has ensured we follow our customers to the market to learn their real challenges. What we found, specifically with non-tariff barriers to trade especially in the West African sub-region, inspired us to help facilitate a regional shipping line that will provide direct maritime links within the sub-region, and this has generated interest in Central Africa as well. Later this year, the Sealink Project, a private sector business which has continued its fund-raising efforts, will launch. Its operation will significantly cut the cost of freight and transportation time for sea cargoes in West and Central Africa. This will be catalytic in lifting and deepening intra-Africa trade from its current low level.
Thanks to the discipline of execution of the trade policy of the Federal Government of Nigeria, NEXIM Bank has been thought in some mischievous quarters to be larger than it actually is in terms of paid-up share capital and fund under its management. But this has a positive meaning. With arrow-sharp focus on execution of policy strategies, we can achieve so much more than we have experienced in our history as a nation and as market-focused institutions. Concluded
Roberts Orya is Managing Director/Chief Executive Officer, Nigerian Export-Import Bank