While Nigeria and the rest of the world were about to recover from the devastating public health and economic effects of the COVID-19 pandemic, the Russia-Ukraine conflict came out of the blue and hit like a thunderbolt.
The effect has been devastating. It has dimmed the prospects of a post-pandemic economic recovery for emerging and developing economies by weakening the global economy through significant disruptions in trade, food and fuel price shocks. All of these contribute to high inflation and subsequent tightening in global financing conditions.
Nevertheless, the conflict has presented opportunities for businesses to source new supply chains and diversify trade networks.
Fidelity Bank Plc (hereinafter referred to as FB) has played a crucial role in this aspect, cross-fertilising Nigerian non-oil export merchants with other global business players.
This was exemplified at the bank’s maiden edition of the Fidelity International Trade and Creative Connect (FITCC) held in London.
The event hosted more than 100 exhibitors from Nigeria with product offerings ranging from processed food to fashion, financial technology and the arts.
The MD/CEO of FB, Mrs. Nneka Onyeali-Ikpe, explained that the expo is an extension of the support the bank provides to the business ecosystem in Nigeria as it (bank) works to help them compete favourably on the global stage.
“Fidelity Bank Plc is a leading financial institution in Nigeria and a market leader in supporting small and medium scale enterprises and export-oriented businesses. This event is an extension of the support that we provide to the business ecosystem in Nigeria,” she said.
The key strategic objectives of the event were to 1) povide a product, service and ideas marketplace that brings together Nigerian Exporters and the UK Business Community to promote and showcase Nigerian goods and services, and to explore product off-take and partnership opportunities; 2) share and exchanging trade, investment and market information with all stakeholders to strengthen and enhance business-to-business and business-to-consumer trade partnerships; 3) facilitate a platform for discussions around improving the export business ecosystem and enhancing the competitiveness of Nigeria’s exports to the UK in areas including quality and standards, compliance, policies, market entry strategies, etc; and 4) create a platform for development finance institutions to share information about their trade finance and trade facilitation interventions.
Onyeali-Ikpe also spoke about the creative industry (brain) products which she said are also exportable.
“Service and brain exports are areas that are often overlooked in the context of exports, but these are sectors that present massive economic opportunities for Nigeria.
“Our music artistes are headlining major shows all over the globe and connecting Nigeria to the world. Our fintechs are transitioning to unicorns and scaling impact globally.
“Our movies and arts have grown in market reach and influence. Our ‘adire’ cloth is becoming a global fashion staple with elements being infused in high fashion pieces. Our food is making waves globally and also finding expressions across different nationalities. These are all part of the FITCC showcase,” she said.
Ultimately, she said the goal “is to expand the global footprints of Nigeria’s value-added exports to help close our balance of trade gaps and stabilise the naira.
As a bank, she said FB is also committed to providing the required financing and advisory service frameworks needed to enable Nigeria exporters meet UK buyers’ requirements and product order fulfillment.
She said the exhibition “equally presents opportunities for British and European businesses to source new supply chains and Nigerian exporters to diversify trade networks.”
She added: “We have designed the programme to help you maximise the opportunities and engagements that the FITCC platform presents which range from product off-take to partnership, financing and investment opportunities.
“The growing number of Nigerians in the UK also presents the business case for increase of Nigeria’s exports to the UK. This represents captive demand and an opportunity for UK retailers to increase their ethnic product quota. This is a win for all parties.
“For the UK government, this will translate to customs duty tax receipt uplifts and for UK retail businesses, this means a more diversified supply chain. Finally, for the Nigerian exporter, this would facilitate increased foreign currency receipts.”
Earlier in the year, the bank had pledged to support the Central Bank of Nigeria’s (CBN’s) goal of achieving the $200 billion foreign exchange repatriation policy (TR200 FX) in the next five years.
The TR200 FX programme has five pillars namely value-adding exports facility, non-oil commodities expansion facility, non-oil forex rebate scheme, dedicated non-oil export terminal and biannual non-oil export summit.
The value-adding export facility is expected to provide concessionary and long-term funding for business people who are interested in expanding existing plants or building brand new ones for the sole purpose of adding significant value to our non-oil commodities before exporting same.
The non-oil commodities expansion facility is a concessionary facility designed to significantly boost local production of exportable commodities.
The non-oil export proceeds repatriation rebate scheme is a special local currency rebate scheme for non-oil exporters of semi-finished and finished produce who show verifiable evidence of exports proceeds repatriation sold directly into the investors and exporters window to boost liquidity in the market.
Under the rebate scheme, exporters who are eligible would get a rebate of N65 for every $1 repatriated and sold at the investors and exporters window for other thirty party use, and N35 for every $1 repatriated and sold into import and export for own use on eligible transactions only.
With the implementation of the policy, the CBN said that the supply of foreign currency to commercial banks will cease by the end of 2022, while investors will be able to generate forex through the RT200 FX programme template provided to strengthen commodity exports.
At a workshop on ‘Harnessing export business opportunities, CBN RT200 FX programme: Current issues, non-oil exports and implications to business,’ held for exporters and investors on the implementation and opportunities in the new CBN RT200 FX, the executive director, northern businesses at FB, Mr. Hassan Imam stated the bank’s commitment to keeping its customers abreast of emerging opportunities in non-oil exports.
He said FB would not relent in its efforts to bridge the knowledge gap in the non-oil sector space by facilitating the necessary processes and documentation for the new policy, with the goal of increasing forex repatriation through exportation.
In the same vein, the bank’s regional head, northwest 1, Mr. Mannir Ringim, re-emphasised the bank’s readiness to support government’s economic imperatives to boost revenue in non-oil sector of the economy.
“Nigeria is currently an import-dependent economy with so much pressure on our currency and the source of revenue as a nation is petrol dollar. So, the initiative of the CBN is to leverage on our non-oil products especially in agriculture like hibiscus flower, cashew nut sesame and many other products for exports.
“Now, Fidelity Bank wants to remain the exporters’ bank of choice not only by providing finance but by helping exporters in bridging the knowledge gap in exporting their commodities.
“We are committed to this initiative to improve our economy, reduce pressure on local currency and provide an enabling environment to grow the non-oil sector to also create massive job opportunities”, Ringim said.
For his part, the head of export and agric businesses, Mr. Isaiah Ndukwe, said the bank “is well positioned to advance the CBN policy thrust to reduce our over-dependence on oil revenue in the country.”
He stated that the bank was committed to improving the banking system’s competitiveness while focusing on developing exporters’ capability in the fundamentals of local commodity exportation.
Ndukwe emphasised that the new policy will not only reshape exporters’ mindsets, but also infuse value addition on their commodities, allowing them to earn more forex.