The Chartered Institute of Bankers of Nigeria held their 14th annual lecture focusing on the distinction between economic growth that emphasizes indices such as GDP growth rate, and economic development that focuses on the standard of living and the quality of life of the citizenry.
Experts at the event which held at the Nigeria’s Bankers House, Lagos, acknowledged the importance of economic growth, but however spoke passionately on the need to begin to give more serious commitment to economic development.
Chairman of the event, Kyari Bukar, Nigerian Economic Summit Group chairperson, emphasized the need to give more support to funding sources for start-ups such as Venture Capital Funds and Angel Investors, the keynote speaker, Professor Kingsley Moghalu threw light on the major economic development and transformation going on in the Asian countries, with countries such as China drastically reducing the percentage of their population in poverty, to near single digit levels. According to him, economic growth must be inclusive.
The founder and Chief Executive Officer of H. Pierson Associates Limited, Eileen Shaiyen, spoke on seven critical high-impact areas that Nigeria must focus to fast-track economic development.
According to a release, she said the first is adequate funding and access to funding for Micro, Small and Medium-size enterprises (MSMEs), both Rural and Urban, who currently contribute largely to our GDP and employment.
“Other high-impact areas for focus are, strong Consumer Lending, funding to Health, Education, the Agriculture Value Chain, as well as to Women and to Exports. She emphasized that the major type of funds needed by these high-impact areas for economic development is ‘patient money’ which largely includes low-cost revolving credit and then capital, both of which should be readily available on a wide-scale, especially in the hinterlands.”
Shaiyen said, “For these to be in place and truly impact economic development, while recognizing the role of Commercial and Merchant Banks, she strongly stated that this category of banks cannot deliver on the listed need areas with significant impact.”
According to her, Nigeria needs a change of positioning in which microfinance banks and similar grass-root focused and capital-providing entities, begin to take the front row in our funding and financial sector discourse and strategies.
Borrowing from the Asian countries for instance, India has 93,550 rural cooperative banks, 1,589 urban cooperative banks, several cooperative credit institutions and 56 regional rural banks, in addition to its regular commercial and foreign banks. Most importantly, the financial ecosystem in India, significantly elevates these grassroot financial institutions to a position of primary and strategic focus and impact assurance, and not as ‘third cousins’ to the commercial banks, a stance Shaiyen said, is still missing in Nigeria.
She urged the association to use their platform to change the narrative and focus, towards these institutions that are critically needed for change in the listed high-impact areas for economic development.
