FX ban to BDCs’ll increase productive capacity of businesses – Finance minister

The Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed has said that stoppage of foreign exchange to Bureaux de Change (BDCs) will increase the productive capacity of businesses. 

Mrs Ahmed said when she hosted participants of the Executive Intelligence Management Course 14 of the National Institute for Security Studies, at the ministry’s headquarters weekend in Abuja. 

According to the minister, the policy will not only guarantee stability of the financial market, it will also increase access to forex for businesses. 

“What has been done is to stop selling foreign exchange through the NAFEX window to BDCs, With their licenses in place, they are free to source FX and do their business under the supervision of the CBN. 

“I will give you an example, onna weekly basis, maybe the CBN has $1million to provide to the market, BDCs get $700,000 of that while the industries and formal businesses just get $300,000. With this policy, what it means is that $1million will now be serving the formal window where formal businesses would be able to access foreign exchange. So, it is enhancing the capacity of these businesses to bring imputs for their production processes,” she asserted. 

She further said that through the

Road Infrastructure Tax Credit Scheme (RITCS), a total of 33 road projects covering  1,564.95 km in 19 States across the country have have been approved for construction, repairs,and maintenance.  

Mrs  Ahmed added that presently, construction work is ongoing on four road projects which is being handled by corporate investors such as Dangote, BUA, MTN, and Access Bank.

The RITCS which is a fallout of Executive Order 7 of 2019 is designed to leverage private sector capital, efficiency and expertise to construct, repair and maintain critical road infrastructure in key economic corridors and industrial clusters in Nigeria. The scheme relieves government of the burden of funding significant outlays for road projects through the annual budget. RITCS utilises tax expenditures, by way of tax credits, to finance the construction of critical road and bridge infrastructure through an innovative PPP mechanism that incentivises private sector participation. 

On misgiving that MTN which has tax liability issues with the Federal Inland Revenue Service (FIRS), the minister explained that in spite of its tax liabilities indebtedness, the federal government would not doubt down the request of the company to help construct a critical road. 

“MTN is owing government but there have been undertaking between MTN and FIRS, and they’ve been following that payment plan. And it would be unwise if you have an organisation that is saying I will use my money to do a critical road and you turn them down because they are owing you. 

“They are in Nigeria, they cannot leave and go elsewhere. They have investments all over the country. 

“And when I say MTN and Access Bank, they won’t be the ones physically building, they will be contracting a construction company that will agree to their quality and pedigree of they performance,” the minister said. 

Ahmed averred that it’s various reform initiatives have led to a more transparent and efficient management of government resources, and blocking of leakages. 

The minister noted that through it’s Project Lighthouse the government has been able to recover N49.7 billion through it’s TaxPro Max from N5.2 trillion outstanding debts.

On the recently released GDP figures by the National Bureau of Statistics (NBS), she said it was an indication that the country was on the part of growth saying “We were growing before Covid-19.”

According to her, the report shows that the Nigerian economy is very much diversified. 

“We are working to diversify export processes and other sources of export,” she said. 

She urged the participants to work together with the government to make the country a safe, secure environment that will make businesses thrive. 

Speaking earlier, the Commandant of the Institute, A.S Adeleke noted that with the present security challenge in Nigeria, it was working seriously to capture senior management staff of MDAs into the security net to make everybody security conscious. 

Adeleke sought for the intervention of the ministry in the area of funding as the Institute is planning to expand its activities. 

“With the expansion in view, I plead with the minister for more funding.”

Executive Intelligence management Course 14 of the National Institute of Security Studies (NISS) is drawn from 24 MDAs and 3 West African Countries.