The Bank of Industry (BOI) has outlined steps Nigeria must take to realize its ambition of achieving a $1 trillion economy by 2026.
This was disclosed by the bank’s Divisional Head of Services, Isa Omagu, on Saturday at the 2024 annual conference of the Finance Correspondents Association of Nigeria in Lagos.
At the conference, themed Nigeria’s Journey Towards a $1 Trillion Economy: Impact of Banks’ Re-capitalisation, Opportunities for Fintechs and the Real Sector, Omagu said it is important Nigeria prioritize enhancing its production capacity.
“The economy relies on both the monetary and fiscal sides; we need both to work together. While the monetary side is trying to stabilize prices, which is its primary mandate, we also need the fiscal side, particularly governance, to come in,” Omagu said.
“We are not producing enough, and we cannot continue consuming imported goods while expecting the economy to be robust.”
He further called for continued investment in agriculture, infrastructure, and services, stating that these sectors will drive production.
According to Omagu, this approach will reduce import dependency and ease the pressure on foreign exchange.
“If we continue to invest in agriculture, infrastructure, and services to a reasonable extent, this will drive production, reduce imports, and alleviate the pressure on our forex,” he noted.
Omagu stressed that boosting production capacity is essential for achieving a $1 trillion economy.
“There’s no way to achieve a $1 trillion economy without focusing on boosting our production capacity,” he said.
He also highlighted several funding initiatives aimed at supporting small and medium enterprises (SMEs) and large enterprises.
“There is a N200 billion integration fund and a N50 billion grant for SMEs in rural areas. So far, we have disbursed up to 98 percent of the money, with N50,000 allocated per beneficiary. Additionally, there’s N5 billion for SMEs, available as a long-term loan at a single-digit interest rate, designed to help SMEs access crucial funding for their businesses,” he explained.
Omagu also revealed a fund for one million start-ups and large enterprises involved in production, which he said will promote job creation and increase exports.
“There is a fund for one million SMEs and another for large enterprises in manufacturing. These funds are offered at a single-digit interest rate, repayable over seven years, enabling businesses to acquire the necessary equipment for production.”
He concluded by expressing optimism that these initiatives would reduce import dependency, grow employment, and help Nigeria produce for export, thereby increasing non-oil foreign exchange inflows into the country.