In this post, we look at the functions of the Nigerian Export and Import Bank (NEXIM). NEXIM Bank promotes exportation in Nigeria through the provision of export credits as well as export promotional programs
The Nigerian Export and Import Bank have played a significant role in the growing Nigerian economy.
When the Nigerian Export and Import Bank was first introduced, there was hope that the Nigerian Export and Import Bank will serve a great deal of purpose.
The bank was necessary, given the fact that there were a programmes already in the country that promotes exportation in Nigeria.
These export promotion programs became necessary since their objectives were to help provides for export credit to willing investors in the country.
These export promotion programs came to be, through the initiatives of this agency, called the Nigerian Export Promotion Council.
There were several export promotion programs going on in the country, programs, such as an export processing zone program, and tax subsidy program, and concessionary financing program, as well as an export credit guarantee program.
But unfortunately, these export promotion programs lacked money to fund local investment in the country.
This was pathetic, as there was not even adequate finance to fund agricultural development in the country.
However, the coming of the Nigerian Export and Import Bank has served as a relief to this problem of lack of credit to finance local investment.
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Be that as it may, the Nigerian Export and Import Bank in 1991, has to begin its business operation in the country, I think with about N500milion, this was in 1991, and from all indications, there is a belief that the Nigerian Export and Import Bank has worked to justify its statutory functions. And in this article, we are going to look at quite a number of them.
Functions Of The Nigerian Export And Import Bank:
The Nigerian Export and Import Bank have played an important role in the Nigerian economy by making funds readily available for local investment in Nigeria.
At its inauguration, the Nigerian Export and Import Bank were assigned a number of functions, believing the Nigerian Export and Import Bank will attain the goals to which it was established through the execution of its functions.
In this article, as I said earlier, we are going to look at these statutory functions of the Nigerian Export and Import Bank together.
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1. Provides Export Credit Guarantee
When we began, in a brief, we were like trying to look at why the Nigerian Export and Import Bank was established, and we happened to understand that, the Nigerian Export and Import Bank was established for the purpose of providing credit for local investment.
Therefore, at its inauguration, the functions of the Nigerian Export and Import Bank were clearly spelled out, and one of those functions was the provision of export credit guarantee to investors seeking to invest in the country within this sector.
2. Discourages Dependent On Crude Oil
All that was expected from the Nigerian Export and Import Bank was to provide the funds needed to invest in local businesses, then it can guarantee the investors, as stated earlier.
We all know that Nigeria, as a country, is dependent on crude oil, so everybody is talking about oil, the federal government, the state government, and even the local government are dependent on crude oil revenue to carry out government’s expenditures, this is unfortunate, meaning that without crude oil revenue, the Nigerian economy would have gone on its knee.
So with the Nigerian Export and import bank, making financial provision for investors to invest in the exportation business, the likelihood is that, the dependent on oil would be drastically discouraged.
Nigerian Export and Import Bank came as a relief, in that, it was empowered to provide non-oil exporters credit guarantee to invest in the exportation business.
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3. Supports Exports With Provision Of Local Currency
Do not forget that, the Nigerian Export and Import Bank is a recognized financial institution in the country.
It deals with currency, and the Nigerian Export and Import Bank are the Federal Republic of Nigeria’s financial establishment, and so, the Bank is in the custody of Nigerian currency.
So by the virtue of its statutory functions, the Nigerian Export and Import Bank has been empowered to provide funds in local money, that is, naira to support export business operations in Nigeria. And we are believing that the Nigerian Export and Import Bank has lived to these expectations.
4. Maintains Foreign Exchange Funds For Local Investment
It is one of the functions of the Nigerian Export and Import Bank to manage funds within its power efficiently, the reason being that, so that, the bank, the Nigerian Export and Import Bank would be able to justify the purpose to which, the bank was established.
Therefore, the foreign exchange revolving money in the Nigerian Export and Import Bank was to be maintained properly, so that the money could be used to lend exporters in Nigeria.
Exporters here in Nigeria may need such credit for the purpose of importing goods with the intention of making such importation to help accelerate or facilitate export promotion in Nigeria. We hoped the Nigerian Export and Import Bank has met this objective.
5. Provides Domestic Trade Insurance To Assist Exports
Another function of the Nigerian Export and Import Bank has been the provision of domestic trade to assist export.
Domestic trade need be provided and promoted to not only assist exports but to encourage exportation business operation in Nigeria.
Apart from making credit available for export investors, the other important function of the Nigerian Export and Import Bank was to make provision by way of ensuring that domestic trade is provided, in fact, with assurance to assist exports.
6. Establishes And Manages Exports’ Funds
Another function of the Nigerian Export and Import bank has been to efficiently manage money meant for export business.
However, this money does not come from the moon, it is the duty of the Nigerian Export and Import bank therefore, to create this money, because the major purpose to which it was established was to make funds readily available for investors seeking investment in the area of exportation business., since exportation business is one of the major trades that boost economic growth of any country.
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The Export and Import bank became necessary since its mandate was to help provide for export credit to willing investors in the country, and in collaboration with the export promotion programs.
The export promotion programs, however, came to be, through the initiatives of this agency, called the Nigerian Export Promotion Council.Click here to see the latest Study Abroad Scholarships and Guides
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