The Central Bank of Nigeria (CBN) yesterday announced policies and programmes to create 10 million jobs in the next five years. The initiative falls within President Muhammadu Buhari's resolve to lift 100 million Nigerians out of poverty through job creation and economic diversification.
In the project, which will last for 10 years, Buhari had said that Nigeria can accomplish the feat because China, India and Indonesia had done same.
Buhari had in his speech to mark the maiden edition of June 12 as the National Democracy Day in Abuja, said that "this task is by no means unattainable. China has done it. India has done it. Indonesia has done it. Nigeria can do it. These are all countries characterised by huge burdens of population."
The CBN, however, limited its job creation scheme to five years since its governor, Mr. Godwin Emefiele, would only be in office for the period, having served out his first term.
He said that the five million jobs would be through the apex bank's increased intervention in the agriculture and credit access to the real sector of the economy.
Emefiele said that in line with President Buhari's directive, his team would boost productivity through the provision of improved seedlings and access to finance for rural farmers in the agricultural sector, across 10 commodities: Rice, maize, cassava, cocoa, tomato, cotton, oil-palm, poultry, fish, and livestock/dairy.
"Our choice of these 10 crops is driven by the amount spent on the importation of these items into the country, and the over 10 million jobs that could be created over the next five years if efforts are made to expand the cultivation and processing of these items in Nigeria," Emefiele said.
The CBN governor spoke at the unveiling of the apex bank's economic blueprint in his new term. He stated that the "banks will therefore be required to maintain higher level of capital, as well as liquid assets in order to reduce the impact of an economic crisis on the financial system."
Buhari had said that a database of poor and vulnerable Nigerians, as well as that of unemployed youths, was being developed to address the problem of socio-economic inequality in the coluntry
The President said that for Nigeria to progress, a collective resolution to address corruption and foster broad-based prosperity is required to create a country that is not only for a few privileged but for all Nigerians.
"In the face of these challenges, our government elected by the people in 2015 and re-elected in March has been mapping out policies, measures, and laws to maintain our unity and at the same time lift the bulk of our people out of poverty and onto the road to prosperity," he said.
Emefiele also hinted of the CBN's plans to recapitalise the country's commercial banks, the second in 15 years.
Although no date has been fixed for the exercise, the apex bank said that it would be carried out in the next five years of the Emefiele's administration.
Emefiele began his second term in office on June 2, 2019, following his reappointment by President Muhammadu Buhari.
The CBN governor said that Nigeria needs a resilient and stable financial system for the continued growth of its economy given the inter-mediation role financial institutions play in supporting individuals and businesses.
When the proposed recapilisation is done, more banks may go into merger and acquisition, the reason being that banks, especially the tier-2 (commercial banks), are adjudged weak due to their low capital base.
But Emefiele said that the planned recapitalisation was aimed at placing some Nigerian banks among the top 500 in the world. This may imply that the policy is not informed by any weakness or distress in the sector.
The last exercise was carried out in 2004 by Emefiele's predecessor, Dr. Chukwuma Soludo, who raised the capital base from N2billion to N25 billion. When the banks recapitalised that year, the naira exchanged rate was about $1/N100. At present a dollar exchanges for N305 at the official rate.
Emefiele, who failed to mention how much the new capital base would be, simply said that "it's a policy thrust that will be discussed at the Bankers' Committee meeting."
He said: "In the next five years, we intend to pursue a programme of recapitalising the banking industry so as to position Nigerian banks among the top 500 in the world."
According to Emefiele, the CBN would develop a robust mechanism that would ensure that necessary safeguards are put in place by banks and financial institutions to protect against loss of data, fraud and cyber incursions in their respective systems.
The CBN governor explained that the planned intervention programmes would strengthen the linkage between farmers and agro-processors/manufacturers by ensuring that the output of farmers is purchased by agro-processors/manufacturers.
He also hinted that his administration would focus more on reducing food prices and employment creation, while driving an economic agenda that would put the country's economic growth rate at double digit.
Emefiele further pledged a target of double digit growth in the next five years by working assiduously to bring down inflation to single digit while accelerating the rate of employment. He said that the target would be met through a strong partnership with the fiscal authorities.
He said: "Our priorities at the CBN over the next five years are... first, preserve domestic macroeconomic and financial stability; foster the development of a robust payment system infrastructure that will increase access to finance for all Nigerians thereby raising the financial inclusion rate in the country.
Emefiele added that the CBN would continue to work with the commercial banks to improve access to credit for not only small holder farmers and MSMEs but also consumer credit and mortgage facilities for bank customers.
He declared that "our intervention-support shall also be extended to our youth population who possess entrepreneurship skills in the creative industry," adding that he's confident that when implemented, "these measures will help to insulate our economy from potential shocks in the global economy."
Emefiele said that during his second term, the CBN would leverage monetary policy tools to bring down the cost of food items while seeking to maintain stability in exchange rate, stressing that its monetary policy measures would be geared towards containing inflationary pressures and supporting improved productivity in the agricultural and manufacturing sectors.
The aim is to anchor the public's inflation expectation at single digits in the medium to long run.
He stated that the CBN must continue to play an active role in supporting the growth of "our economy, and redirect its emphasis on sectors that have the ability to support improved wealth and job creation for Nigerians such as the agricultural and manufacturing sectors."
Emefiele noted that beyond Nigeria's domestic challenge of high unemployment and subdued growth, the economy is faced with three external events: rising trade tensions between the United States and China, United States and Mexico and subdued growth in the Eurozone as well as other emerging economies including China, India, South Africa, which, he said, have the ability to affect Nigeria's growth trajectory over the near-to-medium term.