Vice-President Namadi Sambo last week flayed the high rate at which commercial banks charge interest rates. This, according to him, hampers small and medium scale enterprises (SMEs) in accessing finance for their operations.
He stated this in Saudi Arabia when he met with a delegation from the Islamic Development Bank (IDB) led by its Chairman, Dr Ahmed Mohammed Ali.
According to a statement by his Senior Special Adviser on Media and Publicity, Umar Sanni, Sambo said lack of access to finance remains one of the stumbling blocks to the growth and development of SMEs in Nigeria.
He bemoaned a situation where international financial institutions channel funds through local banks for on-lending to SMEs only for banks to turn around and charge high interest rates.
He therefore urged the IDB to evolve ways through which the SMEs could have easy access to cheap funds to finance theirs businesses.
The vice-president was further quoted to have stated that the federal government has a robust national master plan for SMEs.
While congratulating the chairman for the extension of his services by the Bank, Sambo added that the current rebasing of Nigeria’s GDP has shown Nigeria as one of the fastest growing economies, stressing the need for banks to take advantage of the favourable economic climate to further support the nation in her quest towards rapid socio-economic growth and development.
The vice-president further noted that, with the successful completion of 10 new thermal power plants in the country, there was also the need for adequate gas infrastructure to support the country’s industries.
He urged bank to support financing of both gas and transportation infrastructure to allow for local processing and transportation of gas within the country.
While adding that there were several other power and agricultural projects and programmes which the administration was currently executing that included the Gurara Phase II 260mw hydro power project, the 3050mw larger Mambila hydro-power project, the Itisi Dam Irrigation and Hydro-power Project and the Zungeru 700mw hydropower project, he called for banks’ support in realising these projects” the statement said.
In his remarks, Chairman of the IDB, Ali said the institution has interest in many sectors, which included education, healthcare, project financing, power and gas, at the moment, saying the bank was engaged in a gas pipeline project that would connect the southern and northern parts of Cote D’ I’voire, which was at pilot stage and that they hope to also work with Nigeria in the future if the project works.
According to the statement, high point of the event was the presentation of congratulatory letters by the vice president to the IDB chairman for his 40th anniversary in service and for the extension of his service in the organisation.
Currently the IDB is financing a number of projects in a number of countries across the world including Nigeria. The bank has invested about $68 million on corporate projects in Nigeria and about $100 million to support the SMEs in the country, amongst others.