Repositioning Nexim for Nigerian Agro and Food Exporters' Assistance: Simple Steps for Improvement.

Nexim bank was set up to support import and export trade within Nigeria. We are happy to say Nexim has proven its worth. It has been performing its functions. That makes the bank a very important part of Nigeria financial complex. But there are lot of expectations.

The Federal Government of Nigeria need to embark on a path of transforming the economy, by trying to work with the private sector to expand trade, particularly regional trade, incorporating the West Africa zone and even beyond. With Nigeria's economy accounting for 55 percent of the regional economy, the means our weight means a great deal on the sub-region. Therefore, what we do in terms of supporting our private sector to trade within the region and beyond is very important. As such, Nexim is key and critical if Nigeria is going to play Its role of being the powerhouse without the West Africa sub-region, and beyond that, within Africa.

So far, Nigeria exporters have being impressed that Nexim, which was a near moribund government financial institution a few years ago, has been able to, within these few years, turn the performance curve. When the Federal Government established Nexim through the instrument of Act 38 of 1991, its objectives and mandate as an export credit agency were clear - to provide export credit guarantees and export credit insurance facilities to support and promote export of Nigeria commodities and services within and outside the West Africa sub-region and beyond.

However, within a few years of its establishment, it appeared the bank lost its focus, after its management began paying scant attention to set internal business monitoring guidelines. Apart from operational leakages, the poor corporate governance structure of the bank culminated in a high portfolio of non-performing loans.

With a declining capital base and the absence of a recapitalization scheme to boost the capital of the bank to deliver on its core mandate and services, poor performance records resulted in a loss of confidence by partners and international credit agencies that were willing to lend their support.

By the end of the Buhari Government lead administration, the bank would have inherited huge bad debts totaling about N18.6 billion, about 72 per cent of which was categorized as non-performing, while over N15.03 billion, or 69.05 per cent, was classified lost or irrecoverable in line with prudential guidelines.

Nexim need new focused and purposeful management, those who are inspired by a vision to transform the red in the balance sheet gradually and the productivity graph pointing to an upward scale. With an enhanced vision "to be the leading African export development bank", and a rededicated mission "to become a first class institution promoting a diversified export base through the provision of finance, risk bearing and advisory services in line with government trade policy". This new management, through the provision of innovative services, turned the bank's fortunes around.

The new management will not only establish a risk management strategy and a good corporate governance framework, it should also set up asset creation processes and a business advisory unit to assist prospective customers in preparing their documents properly.

Pursuing an agenda to support Nigerian exporters, particularly small and medium enterprises (SMEs) involved in Greenfield projects under the manufacturing, Agro processing, solid minerals and services (Mass agenda), will enable the bank to be able to disburse loans, while also issuing guarantees to facilitate the provision of hospitality financial for the agricultural non-sector  of the Nigeria economy in line with the Federal Government policy.

Nexim should try and initiate innovative projects to boost regional trade and economic Intergration. The bank should also initiate projects that will help to promote maritime trade among member states of ECOWAS, involving the establishment of new shipping company that would connect West African seaports and increase trade relations among member states of the region.

Despite the bank ups and downs, Nigerian exporters are still expecting a lot more from the members of the board, and want Nexim to play its role effectively. The bank should move into some very innovative areas, into entering into partnerships with many institutions, like the African Development Bank (ADB), Islamic Development Bank (IDB), etc. This is the kind of outtreach Nigeria exporters would like to have.