The Central Bank of Nigeria (Plc) at the weekend, disclosed that its RT200 policy has begun to attract more export commodities.
This was even as the apex bank revealed that the policy will again undergo series of examination and verification exercise to ensure the third quarter (Q3) rebate would be paid to exporters by the end of September.
The Principal Manager, Trade and Exchange Department, at CBN, Anne Ezekannagha, stated this at the 2022 workshop of the Finance Correspondents Association of Nigeria (FICAN) with the theme: “Boosting Domestic Capacity for Sustainable Export Earnings” which held in Lagos. The RT200 FX programme is an initiative of the CBN that aims to raise $200 billion in forex earnings from non-oil proceeds over the next three to five years.
Speaking during a panel session, Ezekannagha, noted that a lot of exporters do not repatriate their proceeds adding that this is what RT200 is trying to do.
According to her, since the conception of the RT200, the figures have improved greatly. “The rebate are to be paid quarterly and currently, we have approved rebate for two quarters; the first and second quarter 2022. Hopefully, by the end of September, there would be another series of examination and verification exercise so that the third quarter rebate would be paid.
We have seen significant improvement not just in the figures that are being repatriated but also in the number of exporters willing to come to the formal sector. A lot of our exports have been happening informally. With this scheme, we are noticing not just the increase in figures but also in the increase of commodities that we are exporting. For example, in the solid mineral sector, we are seeing more players coming to the formal sector to report their export and participate in the RT200”, She said.
Meanwhile, Deposit Money Banks (DMBs) have called on the FG to create a friendly export policy to ensure the RT200 scheme achieves 100 per cent success.
Presenting his paper titled “Boosting Domestic Capacity for Sustainable Export Earnings- the UBA Perspective, the Deputy Managing Director of the United Bank for Africa (UBA), Muyiwa Akinyemi, disclosed that only 200 exporters were responsible for 95 per cent of the $4.2 billion the country earned from non-oil export in 2021.
He noted that the $4.2 billion recorded in 2021 did not include informal exports largely in the wholesale trading in some sectors such as information technology, entertainment and solid minerals while adding that the bank facilitated $1.34 billion (31 per cent) in non-oil export volume in 2021, confirming the bank’s status as Nigeria’s number one export bank for three years running.
Akinyemi said, “It is very important that the government as well as regulators create a friendly market policy and also harness data to boost our exports.
They also need to facilitate capital flows to the commodities exchange. This will aid the success of the RT200 policy.
In her keynote address during the workshop, the Managing Director of the Fidelity Bank Plc, Nneka Onyeali-Ikpe, urged Nigerian commodities exporters to switch to the export of value-added processed commodity items to earn more foreign exchange and improve Nigeria’s balance of trade.
Onyeali-Ikpe, who was represented by the Divisional Head, Exports and Agriculture at Fidelity Bank, Isaiah Ndukwe, said transitioning to value-added exports would provide immediate revenue uplift even without expansion of the primary commodity supply side.
She said a step forward was to move from cocoa beans to cocoa butter or powder and also move raw cashew nuts to kernels, to triple the foreign exchange revenues Nigeria earns from these commodities.
Onyeali-Ikpe said, “Most of our raw cashew nut exports go to Vietnam where more value is added to it and then re-exported. In 2020, Vietnam imported $1.5 billion worth of raw cashew nuts from Africa, added value to them and exported $3 billion worth of processed kernels. The uplift of $1.5 billion represents jobs and tax revenue opportunities that we could have created if this value addition was done in Africa.
At three times increase in revenue, Nigeria can move cocoa exports to $3 billion per annum (currently about $1 billion) and cashew to $600 million (currently about $200 million) in the short term to medium term. If we then double the capacity of our plantations as well as processing capacity, we can exponentially move the numbers”.
According to her, “this is not a reinvention of the wheel. it is a tried and tested lever for sustainable economic development. This is the same model that was used by the Association of South-East Asian Nations (ASEAN) that is Malaysia, Indonesia, Thailand and Vietnam to transform their economies into global manufacturing powerhouses.”