Wednesday, June 22, 2022
Tuesday, June 21, 2022
Monday, June 20, 2022
Mastering The Democratic Republic of Congo Market Under AfCFTA
To read the full content of the newsletter on Mastering The Democratic Republic of Congo Market Under AfCFTA, then Click this Link
Saturday, June 18, 2022
Biannual Non-Oil Export Summit: Feedback For CBN & Banker's Committee
The RT200 FX programme is an initiative of the Central Bank of Nigeria (CBN) and the goal is to generate a total sum of $200 billion in non-oil export proceeds within the next 3-5years. This programme has 5 pillars and one of them is the biannual non-oil export summit. In line with the implementation of the five pillars of the RT200 FX programme of the CBN, the bankers committee together with the management of CBN have organized the maiden edition of the biannual non-oil summit which held at EKO Hotel on June 16, 2022.
This is a promise keep by the CBN Governor and this initiative is commendable and a step in the right direction. A number of issues were raised and recommendations made at this event. All the ideas shared at the event will definitely contribute to the growth of the sector and achievement of the target set if they are well implemented. However, a few observations were made regarding the event which are being highlighted in this article. If these suggestions are put into consideration at the next event, it will enrich the outcomes of the conference and thereby speeding up the race towards the set target of $200 billion.
The first observation is the fact that the programme was seen by participants as a type of monologue. This is because even though there were many participants at the event, the participants were not allowed to participate. After the presentation and discussion by the panelists, only the CBN Governor was allowed to make comment on each of the panel session. The fact that the views and opinion of many stakeholders were not heard, makes the discussions at the programme not to be robust enough to enable the policy makers to take an informed decision. This also makes the programme to be unable to gather enough ideas and wisdom available in the audience and these are seriously needed to solve the problems being encountered in the sector.
The lack of participation of the participants in the discussion is not good for the CBN at all because it did not allow the CBN Governor to hear the pain points of the exporters who are the ones doing the shipments that will generate the export proceeds and therefore help in achieving this laudable initiative of the RT200 FX programme. It also prevented the CBN Governor from hearing first hand from the exporters the challenges that many of them are having with the deposit money banks. As a matter of fact some participants are of the opinion that, the programme was done to fulfil all righteousness and not because the apex bank was ready to solve the problem, since they were not allowed to speak at the event. However, this opinion is not correct because the CBN has started the disbursement under the rebate scheme which is a demonstration of the commitment of the CBN Governor to make the RT200 FX programme a success. This kind of insinuation could have been avoided if the participants were allowed to contribute at the event.
Another issue raised about the programme which I saw on an exporter’s WhatsApp platform few days after the event was about the presentations made by the Managing Directors of banks before each panel session. The participants said “I attended. But, I must say, it was more of CEOs of the Banks trying to justify themselves where export are concerned than the real thing.” Another participants in a conversation said, that “the bank MD’s presentation were used as an opportunity to make their own request to the CBN and get the CBN Governor to meet their needs because they are not interested in helping exporters to solve their problems”. He also went further to say that “ some of the request in those presentation could have been made at the bankers committee meeting rather at such event”.
It was also observed that there was no serious discussion around SMEs participation in export business and this was seen in the export businesses that were represented in the panel (only the large corporates made it to the panel). With the number of SMEs operating in Nigeria, the race to the $200 billion will be a lot easier to achieve if they are given the necessary support to increase their current export volume. Also, there was no discussion about the need and how to grow the number of export businesses in the country. This is very important in order to reduce the average export volume that needs to be done by each exporters in order to achieve a total export proceeds volume of $40 billion per annum and $200 billion in 5 years. Another observation was that discussion on the exportation of processed solid minerals was conspicuously missing. If not for the panelists that spoke about recycling, the programme would have been completed without anything being said on metal export despite the huge potential of processed minerals generating export proceed for the economy.
Finally, the good news about the summit is that it is going to be a biannual event, so there is room for improvement. Also, since the CBN is committed to making this vision a reality, it is expected that lessons learnt from this maiden edition is going to be put into consideration and necessary correction made ahead of the next event which is expected to hold later this year or early next year. Lastly, it is important to congratulate the CBN Governor and his management team plus the banker’s committee for successfully hosting the maiden edition of the biannual non-oil export summit which is a major pillar in the actualization of the RT200 FX programme.
For the love of Nigeria, Africa and Mankind
Bamidele Ayemibo (bayemibo@3timpex.com)
Lead Consultant, 3T Impex Consulting
Thursday, June 16, 2022
Sunday, June 12, 2022
How Nigerian Banks Can Setup A Viable Export Desk
In the
last article on the RT200 FX programme of the Central Bank of Nigeria (CBN).
The need for banks to setup a viable export was emphasized and this is because,
this desk is the engine room that will empower the drive to grow the non-oil
export volume of the banks. A viable export desk is a market facing export desk
that conceive, design, development and deploy the right products and services
needed to grow the non-oil export volume of the bank. To be able to achieve the
goal for which it is set up, the export desk must have the right structure,
right systems, right staffing, right strategies and right services.
The RT200 FX programme is forcing many banks that hitherto do not have a market facing export desk in the country to begin to have one. However the way they are going about setting up this unit will make the desk to only be full of motions in different different but without any movement towards the desired goal. This is because the people setting up the unit in the banks do not have a proper understanding of the sector and the needs of the players and stakeholders therein. As a matter of fact, some of the unit operate like doctor that prescribed a mist mag (a drug for ulcer patients) to a patient that is suffering from typhoid fever. There is a total disconnect between the offerings of most banks and their export desks and the needs of the exporters they are prospecting.
A viable export desk needs to have the right structure. This simply means an organogram showing the sub units in this department, their various reporting lines and their functions. An export desk with the right structure therefore is the one that has not just have a subunit that implement the development and deployment of export finance products and another subunits for marketing and export trade sales to attract more export customers but also have additional subunits for support services needed to attract the micro, small and medium scale exporters. It also shows an affiliate subunits of the export desk at the branch, zonal or regional level.
A viable export desk needs to have the right system in place. Having a right system involves having a working document that enables any new staff deployed to the unit to know what exactly his responsibilities will be as a contributor to the achievement of the overall goals of the unit. This document would highlight the functions of each subunits, the job description of the personnel in each of the subunits and the step by step business operations and processes involved in the execution of the tasks to be performed by each of the subunits.
A viable export desk needs to have the right staffing in place. Having the right structure and systems is not enough if an export desk do not have the right personnel to manage each of the subunits, it is as good as not having the system and structures. There is a major challenge with getting the right personnel in the industry because of a very high level of export skill gap among the the bankers. This is mainly due to many years of neglect of the non-oil export sector. In order to be able to have the right personnel to manage this unit, management of banks need to first of all do an internal sourcing of staff that currently handle import transactions in both trade operations and marketing units of the bank. This should be followed by a thorough capacity building in export business management and export trade finance. These trainings are available online from American Institute of Extended Studies.
A viable export desk needs to have the right strategies and services in place. The interesting part of these two features of a viable export desk is that the two of them go together. This is because designing the right strategies will lead the deployment of the right services to implement the strategies. That is having the right structure, right systems and right staffing in place makes it easy for the staff to design the right strategies which are implemented through the right services. The right strategies and the right services revolves around export customers acquisition, export customers support support services and export customers financing.
Finally, it is important to state that, despite having an export desk, the reason why many banks have not been able to get the desired results, which is an appreciable growth in non-oil export volume, since the commencement of the RT200 FX programme is because, the export desk is not set up to be able to have what it takes (right structure, right systems, right staffing, right strategies and right services.) to function and succeed. The good news is that there are consulting services available to help the banks set up a viable export desk and the details can be found via this link (Click Here).
For the love of Nigeria, Africa and Mankind
Bamidele Ayemibo (bayemibo@3timpex.com)
Lead Consultant, 3T Impex Trade Academy