Analysts laud CBN’s 100 for 100 policy, express worry over headwinds

Analysts have given thumb-up to the Central Bank of Nigeria (CBN)’s “100 for 100” Policy on Production and Productivity (PPP), bit expressed pessimism over headwinds confronting businesses in the country that would possibly dent expected result.

For context, the 100 for 100 PPP is a financing scheme designed to provide targeted funding (in Naira) under existing CBN’s intervention programmes to 100 high-impact companies and projects every 100 days. The instrument would also provide complete forex funding for new machinery. The selection criteria limits the instrument to only new projects and would not cover any refinance of existing facilities.

Furthermore, participating companies and eligible projects must source over 50.0 per cent of raw materials and at least 80.0 per cent of jobs locally.

“We laud the timeliness of this initiative as it could help support some of the businesses that are reeling in difficulty of the Nigerian business environment”, said analysts at Afrinvest..

They recalled that, over the last half-decade, their analysis shows that the industrial base has weakened at a faster pace than the broader economy, hampering the country’s potential to leverage a solid manufacturing base to structurally transform and improve productivity-driven activities.

“Precisely, between 2016 and 2020 the domestic economy grew at CAGR of 0.6 per cent, while Industry recorded a flattish CAGR of 0.05 per cent, with manufacturing (c.42.0 per cent of Industry) contracting by 0.03 per cent.