CBN goes tough on bank debtors, threaten stripping of facilities

…As Nigeria expects $2.5bn forex inflow from Dangote Fertiliser

The Central Bank of Nigeria, CBN, has warned those owing commercial banks to pay up or risk seizure of their facilities.

Governor of the Bank, Godwin Emefiele, said CBN is now more determined to go after chronic and recalcitrant bank debtors and would seize all their facilities, and that if they have private jets they would be meant to ride on bicycles.

He warned that the era of entrepreneurs borrowing from banks and not paying back is gone, Emefiele had warned.

The governor, spoke in Lagos after assessment tour of the Dangote Refinery and Petrochemical Company in Ibeju-Lekki.

He said that the apex bank welcomed people to come, borrow and pay back, but had devised ways of recovering loans from those who may try to default.

“The era of entrepreneurs borrowing from banks and not paying back has gone because, if you don’t pay, we will take your money wherever you are keeping it,’’ Emefiele said.

He said that the size of loans that were in AMCON, yet to be recovered as of today, were from Nigerians.

“CBN will not allow you borrow and not pay again,” Emefiele said.

According to him, it is time credible people came out to borrow and pay back.

The apex bank governor thanked Alhaji Aliko Dangote for coming up with the refinery project, urging other Nigerians to join him to grow the country’s economy.

“We go to different sessions and summits in other parts of the world, what people tell us is that we need to think of how to work with Nigerians.

“But for them to work with Nigerians also means that Nigerians themselves must stand tall and be ready to come out and help their country,’’ he said.

Emefiele explained that “the government has made investing in Nigeria better with low-interest rate’’.

He said that the idea of the low-interest rate was to ensure that entrepreneurs increased employment levels and got industries back to work again.

The CBN governor said that growing the economy was not the sole responsibility of the government, which was just an enabler.

He called on Nigerians and foreigners who believed and found Nigeria as a good investment destination to come, assuring that the banks would do everything possible to help them succeed.

“People like Aliko Dangote, Tony Elumelu, Jim Ovia, should come out and be counted in this journey.’’

Emefiele said at the facility (Dangote Refinery and Petrochemical Company) that there were over 34,000 people working in it, and it would double to about 65,000 in the next two months.

He appealed to entrepreneurs to come out and initiate projects that would provide gainful employment to people, noting that that is how a country sees prosperity.

The CBN governor said that the apex bank would make policies that would protect such entrepreneurs for coming out to develop and grow the economy.

Emefiele, called on Nigerian entrepreneurs to put thier investments into developing the country, saying the apex bank is ready to do anything to protect them as he commeded the President of the Dangote Group for his commitment towards the development of the economy.

He commended the efforts made by the Dangote Group of companies for its commitment to creating industries that major off takers of Nigeria’s foreign exchange.

President of the Dangote Group, Alhaji Aliko Dangote had mentioned during the tour that the fertilizer plant which will commence commercial production in May this year will be the biggest plant in the sub saharan Africa region. He also noted that the refienry is expected to have concluded tests by the begining of next year and commence operations in the first quarter of 2021.

Dangote while speaking on the progress of the refineries, said: “Right now, we have reached over 48 percent but majority of the equipment’s when they come are just going to be installed. We have done all the foundations as you have seen and first of all we want to thank the governor, deputy governor for visiting here just to justify the help they have given to us.

“They were here last year and one of the reasons they are supporting us is that eventually we are going to help in terms of not only creating jobs but also in reducing the outflow of foreign exchange not only in petroleum products but also in petrochemicals, fertilizers and co. We would be one of the highest foreign exchange generating company going forward.

“It is a huge project and that is why we have built a jetty and the pipeline which we are bringing in the crude.

“I must confess that without the government support, there is no way we would have done what we have done so far. And I think we must thank Mr. President for his policies and we thank the CBN management for generally bringing down interest rates so that it can encourage other entrepreneurs to go into mega projects like this. We should not wait for foreign investors to come and develop our economy, it would never happen. So we have to do it ourselves.”

He further added: “We have been complaining that interest rates are high so now that interest rates are low and banks are being forced to lend money out, entrepreneurs should come out with their seed capital to borrow more money so we can develop our country.”

On the impact of the industries to economy, he said: “Nigeria would become the biggest and only urea exporter in sub Saharan Africa for the first time. And we are not only exporting, we would be exporting big time. Between us and Indorama, this going to about 4.5 million tons of urea which is fertiliser annually.

“We also have polyethylene which is about 1.3 million tons annually. These two products would bring in something like about $2.5 billion annually in terms of foreign exchange. A lot of Fx would now come in and that $2.5 billion is only about 10 percent of remittances. Secondly, Nigeria would now become the largest exporter of petroleum products in Africa from our own domestic crude.

“Apart from that, there are other areas which the central bank has sort been encouraging us with financial encouragement which is also given us hope to carry out projects and that they would help with whatever they can.”

Emefiele on his part said “we need to thank Aliko Dangote for the determination and his large heart. This is not a project that an ordinary person could have ever have contemplated. I was here in 2016, 2019 and I’m also here today.

“The central bank is interested because there is a need at this time for us to diversify the base of Nigerian economy from oil into other areas where we can earn revenue.

“The fertiliser plant which would be start commercially in may 2020 would curb the fertiliser scandals and importation. The president in his wisdom said we would no longer import fertiliser and this fertiliser plant of Dangote is 10 times of that of Notore and this plant would generate $1 billion annually. And the fertiliser would be used for our domestic consumption to help our agriculture transformation and the rest. 75 percent would be exported and we would earn $750 minimum only from fertilisers.”

Meanwhile,  he urged entrepreneurs to come out and contemplate projects where people can be gainfully employed saying “we will support anybody, let them come out and we will put in policies that will protect and make sure that for coming out, to develop our economy, grow the agric, the manufacturing, industry, central bank rakes in dollars to fund our obligations we will appreciate them.”

 

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