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A review and appraisal of Nigeria\u27s experience with financial sector reform
No full textThe primary aim of the paper Is to highlight the policy reforms In Nigeria\u27s financial sector since 1986, assess the results of the reform programme, and Identify the lessons that can be learned from the policy initiatives. The reform package was introduced in 1986 against the background of prolonged macro-economic distortions and economic deterioration, especially during the first half of the 1980s. Financial sector reforms under the aegis of the Structural Adjustment Programme were designed to induce more domestic savings and reduce the distortions in investment decisions. To this end, measures were introduced between 1986 and 1992 (the period covered by the review) to Improve the financial structure, monetary management, capital movements and the functioning of the foreign exchange and capital markets. The underlying philosophy of the measures was the primacy given to market factors and a strong regulatory framework In the allocation of resources. The findings of the study indicate that some of the goals of the reform programme have been achieved. Among others, the reform package has resulted in improved capital base, assets, savings, and competition. Despite the unstable macroeconomic environment, the monetary system performed better, especially with the deregulation of Interest rates, gradual reduction in credit controls and Implementation of open market operations. Financial sector reform also supported the observed increase In real economic activity during the period through increased credit and savings for private and public investment, as well as more appropriate exchange rates. The review identifies some of the lessons from the reform effort as the need for macroeconomic stability, an appropriate interest rate structure, adequate financial infrastructure and a more effective incentive framework to reduce the size of Informal markets. To sustain the financial reform process, the review concludes that new policy initiatives are needed in these areas
A Review of Small-Scale Enterprises Credit Delivery Strategies in Nigeria
No full textThe paper reviews the crucial role of Small-Scale Enterprises (SSEs) in facilitating industrial development; some special advantages of existing credit schemes to small-scale enterprises: the peculiar handicaps which SSEs face, the most crucial being poor access to development finance, and highlights areas and ways in which credit guarantee and insurance schemes for SSEs could increasingly contribute to their development and growth in Nigeria. Notable among the credit schemes and institutions reviewed are the Small-Scale Industries Credit Scheme (SSICS) introduced in 1971; the Nigerian Bank for Commerce and Industry (NBCI) established in 1978: the Nigerian Industrial Development Bank (NIDB); the Central Bank of Nigeria\u27s credit guidelines for SSEs under the Bank\u27s Monetary Policy Guidelines: and the Central Bank\u27s Rural Banking Programme. effective from 1979. Other relatively new schemes and institutions also covered, include the National Economic Reconstruction Fund (NERFUND); the World Bank sponsored Small and Medium-Scale Enterprises Loan Scheme (SMEX); the Nigerian Export and Import Bank (NEXIM): the People\u27s Bank of Nigeria (PBN) and the Community Banks
Sustaining Agricultural Production in a Deregulated Economy
No full textThis paper reviews the policy framework for Nigerian agriculture and gauges Its Impact prior to and since the commencement of economic deregulation. It investigates the prospects, analyses the constraints and outlines a feasible strategy for sustaining agricultural growth in a deregulated enabling environment 1he paper notes that in the pe1iod, 1970 to 1982, the deterioration in agricultural performance In Nigeria was the result not only of external shocks and environmental and/or edaphic factors, but of distorted policy pursuits which Created disincentives for farming. However, following attempts .to deregulate the economy with the adoption of the Structural Adjustment Programme in 1986 and the consequent effort to get price Incentives right for agriculture, there was some Improvement in agricultural performance
Macro-Economic policy: an analytical framework
No full textThe author considered the models which appear to be useful in analyzing the forces determining many major variables relating to the economy as a whole: the level of national income (y), employment (n) and the general level of prices. The models also represent the major economic relationships necessary to analyze many important issues of economic policy
Restructuring the Nigerian financial sector for economic resuscitation.
No full textThis paper examines major developments in the Nigerian financial sector and discusses efforts made so far by the authorities to restructure the sector so as to enhance its efficiency. Major Developments in the Financial Sector The Structural Adjustment Programme (SAP) which was adopted in 1986 was the nation\u27s inevitable response to the suffocating effect of the external debt burden on the Nigerian economy, the escalating fall in agricultural productivity, and undue dependence on petroleum as a foreign exchange earner. The paper noted that the increase in the number of banks resulted in competition for bank deposits and other patronages from bank customers. However, the decision of the Federal Government to withdraw public-sector deposits from commercial and merchant banks in 1989 exposed the fragility of the funding base of many banks. The liquidity crisis that ensued from that directive, necessitated the granting of CBN/NDIC Accommodation Facility to a number of distressed banks in order to sustain public confidence in the banking system. To meeting the challenge of this financial sector distress, the need to enhance supervisory practice and performance to meet international standards is stressed with specific reference to: instituting a new legal framework; introduction of deposit insurance; prudential guidelines; equity participation of banks in the business of their customers; quality of management; review of supervisory methodology; and establishment of credit bureau. The paper concludes that for the Nigerian economy recover with vigour again, its financial sector must be properly re-structured and re- invigorated by the multiple participants in the Nigerian economy which includes government which is responsible for fiscal discipline; the operators who must embrace probity and professionalism; and the regulators whose efforts require coordination for effective service delivery
1993 Budget of Transition.
No full textA Federal Government proposals for the 1993 budget of transition with wide ramifications for the third republic and the long-run survival of Nigeria. Also serves as a guide for laying sound foundation for growth and development in the next decade and beyond
Central Bank of Nigeria Statistical Bulletin, June 1993
No full textThis volume/year presents data on the Money and Banking sub-sector, including central banking, financial markets, non-bank financial institutions, clearing house activities, merchant and commercial banking, and public finance statistics. The data includes consolidation of commercial and merchant banks\u27 first and second schedule statistical returns, computation of liquidity ratio, cash reserve ratio, loan/deposit ratio, proportion of loans to rural borrowers and small-scale enterprises, and reconstitution of the Central Bank\u27s balance sheet. The data also indicates the level of banking habit in the industry.
It further explains the classification of insurance companies by their business type, including whole life, non-life, and mixed (life and non-life). It also shows the structure aggregate of insurance companies by types of business and ownership and records the aggregate income and expenditure of insurance companies by type of ownership, including wholly Nigerian and joint ownership. It shows the aggregate source of income of all insurance companies under different types of business and records the total investment of all insurance companies by type of business, including life and non-life. It also includes the Gross Domestic Product, Gross National Product, Gross Fixed Capital formation, Private Consumption, Gross Consumption, and Gross National Savings. It goes ahead to include agricultural crops, which are classified according to the United Nations Food and Agricultural Organization (FAO) Product Year-Book, and also provides a comprehensive overview of the insurance industry in Nigeria.
The Nigerian economy has experienced significant changes in recent years, including the rapid depreciation of the naira exchange rate, accumulation of payment arrears, rescheduling of external debt obligations, and debt consolidation. These changes are captured in the Balance of Payment (BOP) compilation, which is a systematic record of economic transactions between residents and non-residents. The BOP records transactions in goods, services, income, ownership changes, and unrequited transfers. The BOP has been reviewed four times in the last ten years, with the fifth edition being prepared. The foreign exchange rate management in Nigeria has evolved from an officially pegged exchange rate system to a market-determined system. Since 1985, the naira exchange rate has been determined through the foreign exchange market, and other currencies are determined at the market rate values. International trade takes place between the residents of a country, the reporting economy, and the rest of the world, and is usually divided into three sections: the Current Account, the Capital Account, and the Reserve. Transactions involving payments to a country by foreigners are classified as credit entries, while those involving payments by the same country to other foreigners are classified as debit entries
Some Strategies for Development of Nigeria\u27s Agricultural Sector in the 1990s
No full textThis paper reviews the major policy measures Introduced by the government to Induce growth of output of the agricultural sector and accelerate Its development. Some measures adopted before the Introduction of the Structural Adjustment Programme (SAP} Included producer prices selling through Marketing Boards, establishment of financial Institutions and Funds to extend credit to the sector at concessionary Interest rates, and the provision of extension services by ministries of agriculture. Agricultural policy measures under SAP consisted, among others, of abolition of Commodity Boards, free market determination of agricultural product prices, a ban on the export and Import of selected agricultural products and reduction of Input subsidies.
Preliminary draft of this paper was presented at the Nigerian Economic Society\u27s Seminar in Lagos in December 1992
Developments in the Insurance Industry in Nigeria in 1991
No full textNigeria\u27s insurance Industry expanded marginally In 1991. While some companies In the Industry diversified their activities from wholly life lo joint life and non-life, the number of companies formerly In the life business remained unchanged. Amidst general price increases, the aggregate industry Income rose although expenditures increased foster
State of the economy: Central Bank of Nigeria Perspective
No full textThis paper reviews broadly developments in the real, monetary and financial and external sectors of the economy from 1991 to 1994. It highlights the problems confronting policy makers and put forward some recommendations for consideration. The overall performance of the Nigerian economy during the past three years has been characterized by declining growth rate of GDP in turn a reflection, in the main, of the negative impact of the macroeconomic and financial imbalances. The major factor underlying the adverse movements in macroeconomic variables since 1991 has been the rapid growth in CBN credit for the financing of Federal Government\u27s fiscal deficit resulting in excessive growth in monetary aggregates. The negative effects of this development include intensified pressures on domestic prices, the Naira exchange rate, and the balance of payments. Other major problems include large external payments, low output growth and unstable socio-political environment