CBN injects $660m Forex into Industrial Sector

The Central Bank of Nigeria (CBN) has disbursed $660.17 million to 1,342 manufacturers, power and other real sector operators for raw materials, plants and machinery, a foreign exchange (forex) utilisation report has shown.

The funds, sourced from the CBN and sold to the beneficiary customers at the official rate of about N305.5 to the dollar, were handled by commercial, merchant and non-interest banks using the interbank market, the CBN report said.

The funds were specifically used for the procurement of raw materials, plants and machinery as specified in the Letters of Credit (LCs) under which they were sourced and in-line with the CBN-stipulated import approval list.

The report is  meant to promote transparency and accountability on the side of the lenders which act as a link between the regulator and the forex users.

The report, which was for September, showed that a large part of the funds went to 20 companies. Dana Motors ($12,877,278.81), Nigeria Breweries ($6,240,000), A-Z Petroleum Products Limited ($12,962,425.04), Rahamaniya Oil & Gas ($19,220,000), Dag Motorcycles Industries Nigeria ($27,964,123) and Seven-Up Bottling Company Limited ($5,882,293.67).

Others are: Biswal Limited ($6,779,858.11), HIS Nigeria Limited ($10,006,405.57), IPI Power Tech ($7,405,595.55), Promasidor Nigeria Limited ($5, 122, 472.80), Saba Steel Industries Limited ($11,147,478.58), and Crown Flour ($10,254,558). Also listed are African Foundries Limited ($4,020,679.36), Parco Enterprises Limited ($6,558,320), Prime Plastochem Nigeria Limited ($5,668,012.75), TempoGate Oil & Gas ($7,145,279.25), Saro Agro Sciences Limited ($10,106,833.54), Midland Rolling Mills Ltd ($9,895,653.60), Flour Mills of Nigeria Plc ($11,968,016.74) and Matrix Energy Limited ($14,872,223.91).

The report also showed the raw materials that the beneficiaries used the funds to import. Dana Motors Limited imported  Kia brand of vehicles in semi-knocked; Nigeria Breweries Plc brought in malt row winter specifications. Dag Motorcycles Industries Nigeria Limited imported  Bajaj vehicles spare parts.

African Foundries Limited used its funds for the importation of industrial raw materials; Parco Enterprises Limited (hard wheat) and  Seven-Up Bottling Company Limited (273 units of Pesi-Cola).

A-Z Petroleum Products Limited, Rahamaniya Oil & Gas Ltd, TempoGate Oil & Gas imported gasoline. Biswal Limited imported Yaanmar engines.

HIS Nigeria Limited used its funds for telecom plant and equipment import. IPI Power Tech imported automatic board panel. Promasidor Nigeria Limited procured Cowbell powder. Matrix Energy Limited brought in unleaded gasoline.

The CBN said providing forex to the manufacturers and other key players in the economy was meant to it keep its promise to strengthen the real sector by ensuring that 60 per cent of available forex is used to procure industrial inputs, such as raw materials, machine spare-parts, telecom equipment, plastic raw materials, agricultural machines and pre-payment meters, amongst others.

The CBN has also expressed its commitment to ensuring that manufacturers of goods for which Nigeria does not enjoy comparative advantage get LCs to import the required materials for their businesses.

The exercise, the CBN insists, would provide a new lease of life in the manufacturing sub-sector, and also boost industrial output and employment. The regulator said it will continue to support and facilitate hitch-free procurement of necessary industrial inputs to sustain productive activities in the manufacturing sector.

The gesture, it said, buttresses its commitment to rejuvenation and sustenance of industrial activities and retention of jobs.