Dissecting CBN’s N4.51trn intervention programmes for economic growth


At the monetary policy meeting which took place in Abuja in November, the Central Bank of Nigeria presented its performance scorecard on its various intervention programmes to boost productivity in Africa’s largest economy. According to the Bank, a sum of N124.8 billion was disbursed between September and October to nine different programmes. Cumulative disbursements to the nine projects as at end of October 2022 stood at N4.51 trillion. BAMIDELE FAMOOFO reports.

Uba Group

As at the end of October 2022, the Central Bank of Nigeria has made about N4.51 trillion to pass through the hands of over 6 million persons under its intervention programmes targeted to enhance productivity and growth in Nigeria’s economy.

Only in two months (September and October), the Bank, according to a report presented to the MPC at its last meeting of the year, disclosed that it disbursed about N124.8 billion fresh loans through the commercial banks to the programmes.

Director of Corporate Communications, CBN, Osita Nwanisobi, justifying the intervention programmes of the CBN, which he puts at 37, noted that it was a practical effort to diversify the economy.

“The interventions do not just happen, but are well-thought out responses by the CBN to exigencies, and practical efforts to diversify the economy,” he explained.

Nwanisobi added that the interventions were responses to market failures, stressing that no responsible central bank would fold its hands and watch the nation’s economy go down.

Olabimtan Adebowale, Director, Development Finance Department of CBN, said the interventions were meant to increase lending to high-impact and employment-elastic sectors of the economy, diversify economic base, create jobs and improve macroeconomic stability.

He said they were also to encourage exports and conserve foreign exchange reserves, expand output of agriculture, manufacturing and services sectors, provide access to affordable credit, and boost the capacity of MSMEs in priority sectors of the economy.

Meanwhile, figures provided by the National Bureau of Statistics on how the economy performed in third quarter of 2022, might just attest to the claims of the CBN that the economy would have recorded a regression especially after the Covid-19 problems but for its interventions in the critical sectors of the economy.

The claim that the intervention programmes are meant to boost growth in the non-oil sector is also appearing real as the nation’s non-oil sector has taken the lead with respect to contribution to GDP growth in recent times.

“The claim that the intervention programmes are meant to boost growth in the non-oil sector is also appearing real as the nation’s non-oil sector has taken the lead with respect to contribution to GDP growth in recent times”

Non-oil contribution to GDP in Q3

The Q3 Gross Domestic Product growth in real terms saw a 4.27 percent growth from the non-oil sector which has been the engine of growth since late 2020.

This performance was lower by 1.18 percent points when compared to the rate recorded in the same quarter of 2021 and 0.50 percent points lower than the second quarter of 2022.

On aggregate, there was a 94.34 percent contribution from the non-oil sector and this was majorly driven by Services, Manufacturing and Agriculture.
Other major contributors are Information and Communication; Trade; Transportation (Road Transport); Financial and Insurance; Agriculture (Crop Production) and Real Estate sectors all accounting for positive GDP growth.

This growth was higher than the share recorded in the third quarter of 2021 which was 92.51 percent and higher than the second quarter of 2022 recorded as 93.67 percent.

Meanwhile, the oil sector continued its trend of retarded growth as it shrank 22.67 percent, after an 11.77 percent slump in the previous quarter, and reflects lower oil output as the average daily crude oil production stood at 1.20 million barrels per day, down from 1.43 million daily barrels in Q2 and 1.57 million barrels daily a year ago.

This decline in daily oil production can be said to have been precipitated by unprecedented oil theft through pipelines and fields in the oil-producing Niger Delta region; bringing Nigeria’s daily oil production to a historic low.

Nigeria’s GDP grew by 2.25 percent in real terms year on year to N18.96 trillion in the third quarter of 2022 but decelerated 1.29 percent points from the 3.54 percent expansion reported in the second quarter of 2022 and hits below market expectations for the reported period.


However, the total real output surged by 9.68 percent quarter on quarter in the current period and was underpinned by the nations’ involvement in more economic activities than the prior quarter. This is according to the latest GDP data released by the National Bureau of Statistics.

A peep into the report from the NBS showed that this advancement by 2.25 percent marks the eight-consecutive quarter of growth but at the slowest pace since Q1’21.

This deceleration was prompted by the base effects of the 2020 recession as well as the slow pace of economic activities that was hampered by challenging economic conditions. Consequently, the Q3 growth deteriorated 1.78 percent points from the 4.03 percent reported in the corresponding quarter of 2021.

Taking a retrospect into how the nation’s economy has fared so far this year and particularly in the reported quarter, the 2.25 percent slow in output growth reflects the worrying events such as the incessant power outages experienced by households and businesses which brought about an increase in operating cost and pressure on their margins, the impacts from increases in food and fuel prices plus rising imported food inflation figures, the bane of insecurity across the federation which affected business activities in some regions as well as the dampened business environment that has left Nigeria’s growth prospect in the bleak.

MPC urges policy sustenance

Members of the CBN’s MPC urged the Bank to sustain its current policies to boost non-oil exports in order to shore up the external reserves.

The Committee in a communiqué issued after the 145th edition of the MPC meeting which ended Tuesday, November 22, in Abuja, observed the decline in the external reserves position, as gross external reserves decreased by 1.34 per cent at end-October 2022 to $36.87 billion, from $37.39 billion at end-September 2022.

The call is coming after a hint from the CBN that it is slowing down on disbursements to projects under the intervention programmes. CBN Director, Development Finance Department, Yusuf Yila, who made the disclosure sometime in September, noted that the disbursement of all intervention programmes will focus only on the priority areas, particularly electricity and SMEs.

He clarified that the intervention schemes were not being shut down anyway, adding that the manufacturing sector accounted for 31 per cent of the CBN intervention efforts.

Explaining the rationale behind the CBN’s decision, Yila said: “We’ve already started even before the announcement of the MPC to taper some of the programmes that we were doing. I can confirm to you that the gates have been closed. To make the monetary policy tool that has been deployed very effective, you definitely strain the money supply.

“So, indeed, we have closed the gates; only interventions that are very, very critical. MSMEs that are statutory which take 5 per cent of every bank’s profit after tax, it is not a lot to deploy to SMEs, and then supporting the electricity sector is very, very critical,” he noted.

The CBN clarified that out of the N9 trillion interventions it had disbursed in critical sectors of the economy, about N3.7 trillion had been repaid by beneficiaries as at September while about N5 trillion was not yet due for recovery.

While emphasising that the CBN’s interventions were not grants, but loans that must be paid back, Yila added that the CBN had actually activated the Global Standing Instruction (GSI) to recover loans from the various beneficiaries of its intervention support.
“There will be no mercy, everybody must pay back,” he said.

“Between September and October 2022, under the Anchor Borrowers’ Programme (ABP), the Bank disbursed N41.02 billion to several agricultural projects, bringing the cumulative disbursement under the Programme to N1.07 trillion to over 4.6 million smallholder farmers cultivating 21 commodities across the country”

Latest disbursements

Between September and October 2022, under the Anchor Borrowers’ Programme (ABP), the Bank disbursed N41.02 billion to several agricultural projects, bringing the cumulative disbursement under the Programme to N1.07 trillion to over 4.6 million smallholder farmers cultivating 21 commodities across the country. The Bank also disbursed N0.30 billion to finance large-scale agricultural projects under the Commercial Agriculture Credit Scheme (CACS).

Consequently, the total disbursement under the Scheme for agro-production and agro-processing stands at N745.31 billion for 680 projects.

In addition, the Bank released the sum of N48.30 billion under the N1.0 trillion Real Sector Facility to seven (7) new real sector projects in agriculture, manufacturing, and services. Cumulative disbursement under this Facility currently stands at N2.15 trillion to 437 projects across the country, comprising projects in manufacturing (240), agriculture (91), services (93) and mining sector (13).

Furthermore, under the 100 for 100 Policy on Production and Productivity (PPP), the Bank disbursed the sum of N20.78 billion to nine (9) projects in healthcare, manufacturing, and services. The cumulative disbursement under the Facility therefore, amounted to N114.17 billion in 71 projects. Moreover, the Bank disbursed N4.00 billion under the Intervention Facility for the National Gas Expansion Programme (IFNGEP) to promote the adoption of compressed natural gas (CNG) for transportation and liquefied petroleum gas (LPG) for cooking.

In support of the resilience of the healthcare sector, the Bank also disbursed N5.02 billion to four (4) healthcare projects under the Healthcare Sector Intervention Facility (HSIF), bringing the cumulative disbursement to N135.56 billion for 135 projects in pharmaceuticals (33), hospitals (60) and other services (42).

Under the Micro, Small and Medium Enterprises (MSME) sector, the Bank provided support for entrepreneurship development with the disbursement of N1.33 billion and N10.00 million under the Agribusiness/Small and Medium Enterprise Investment Scheme (AgSMEIS) and Micro, Small, and Medium Enterprise Development Fund (MSMEDF), respectively. Hence, the total disbursement under these interventions amounted to N150.22 billion and N96.08 billion, respectively.

Under the Export Facilitation Initiative (EFI), the Bank provided support for export-oriented projects to the tune of N5.34 billion, such that the cumulative disbursement under this intervention stands at N44.58 billion.