By Ayobami Adedinni
The Vice President, Professor Yemi Osinbajo has said the recently released Economic Recovery and Growth Plan (ERGP) by the Federal Government is expected to achieve a sustained, inclusive growth and achieve a growth rate of 7 per cent by the year 2020.
He made this known yesterday at the ongoing World Conference of Banking Institutes hosted by the Chartered Institute of Bankers of Nigeria.
According to him, focussing on core principles of overcoming existing supply constraints and working in partnership with the private sector,”we plan to restore growth to the Nigerian economy, invest in our people and build a globally competitive economy. Our effort to restore growth depends very much on improved macroeconomic conditions.
“Accordingly, fiscal, monetary and trade policies will be aligned to stimulate the economy and support growth while preventing overheating. Sectoral policies are also being implemented to diversify the economy by boosting investments in agriculture, manufacturing, mining and services including finance, construction and the digital economy,” he said.
Speaking further, he said the banking and finance industry has contributed to the national economic development in many ways.
In his words, “Over the years, the banking and finance industry in Nigeria has supported national economic development in many ways. It has contributed to growth and innovation in economic activities and provided employment and opportunity to a large number of Nigerians. This contribution owes in part to the quality of the personnel in our banking and finance institutions who have been trained and certified under the auspices of the Chartered Institute of Bankers of Nigeria.
“It is in a similar context that we expect that the banking and finance sector will support our national Economic Recovery and Growth Plan. As most people here already know, we recently released our Economic Recovery and Growth Plan. Its objective is to achieve sustained, inclusive growth and achieve a growth rate of 7% per annum by 2020.
“We do realise of course that success in this regard depends to a large extent on the quality of infrastructure as well as the business environment. The plan accordingly emphasises the re-building and rehabilitation of roads to establish connectivity across the federal road network, re-vitalising the railway sector and resolving the challenges in the power sector,”he stated.
According to him, training bankers to cope in this changing environment to manage risk and to comply with complex regulatory requirements will become even more challenging.
He said,” It is quite evident that the banking and finance sector has a key role to play in supporting the ERGP. In addition to its traditional role of financial intermediation, the banking sector is critical to the successful implementation of the Plan. To start with, because the private sector is expected to play a major part in plan execution, especially through public-private partnerships, it follows that the banking and financial sector will be a major source of the private capital expected to complement government investment.
“This is why our Plan places emphasis on education and health outcomes. Moreover, it includes a social investment programme that combines job creation with a stimulus package, value-addition and empowerment of economically vulnerable groups. The N-Power programme has engaged up to 200,000 young previously unemployed graduates while the Home Grown School Feeding Programme for primary children continues apace alongside the Government Empowerment and Enterprise Programme aimed at cooperatives and market women’s associations.
In addition to revitalising the economy, the Buhari Administration came into office with a promise to tackle Nigeria’s security and corruption challenges.
While there is visible and tangible progress being made in this regard, we do realise that the efforts have to be continuous and coherent, which is why the Plan also lays emphasis on governance and delivery, which has been generally recognised the bane of plan implementation in Nigeria.
It should also be acknowledged that the banking sector is playing a critical role in the delivery of Federal Government social investment programmes.
The spread of banks has made it somewhat easier to make payments to beneficiaries of the scheme although I must say that more needs to be done with regard to financial inclusion so as to extend banking services to the poor and those living in rural areas. The Bank Verification Number is an innovation that has also been used to support the social programmes because it helps the process of identification while also eliminating the possibility of ghost participants and beneficiaries.
The banking and finance sector in Nigeria will quite naturally also be affected by future developments in the global banking industry. Global banking has become more intricate and complex as a result of liberalisation, the use of new products and the size of banks. As a result, banking regulation has also become more intricate with tougher rules on capital requirements and issues of moral hazard remaining on the front burner.
“In addition to core banking principles and practice, I would urge that training and life-long learning should place greater emphasis on ethics. The reality is that the huge sums of money involved in illicit financial flows which is contributing to rising inequality often happen through the financial system. As issues of beneficial ownership and automatic exchange of information come to the fore, banks must prepare themselves to cope and operate profitably as the world moves towards an era of greater financial transparency.
Another obvious area of change is financial technology or ‘fintech’, through which the digital economy is impacting on banking and finance. Already, block chain technology, internet banking, the use of Automated Teller Machines and indeed the emergence of mobile banking applications are changing the banking sector. All of these developments will impact on the operations of banks including client relationships and will quite naturally need to be factored into the training of bankers,” he added.