President Muhammadu Buhari has mandated the Central Bank of Nigeria (CBN) to invest 50 billion naira into the Nigeria Commodity Exchange (NCX). Buhari also stopped CBN’s planned sale or privatisation of the NCX.
In a chat with press men in Abuja at the inauguration of a steering committee to oversee the repositioning of the NCX, CBN Governor, Godwin Emefiele disclosed that President Buhari has approved an investment of at least N50 billion through the InfraCo structure to reposition the NCX.
Other approvals granted by President Buhari included that CBN, as majority shareholder of NCX, should collaborate with Nigeria Sovereign Investment Authority (NSIA) and Africa Finance Corporation (AFC), under the Infraco Structure, to develop and implement a strategic repositioning plan for the NCX to make the NCX an efficient world class commodity exchange.
Going forward, there will be a steering committee (SteerCo) chaired by the CBN Governor and including representatives from NSIA and AFC as well as the federal ministries responsible for finance, budget and national planning; industry, trade and investment; and agriculture and rural development, to oversee the implementation of this strategic plan.
There will be a revalidation of CBN’s 59.7 per cent majority shareholding stake in NCX, to enable it implement far reaching measures, which includes reconstitution of NCX’s board and board committees, appointment of chairman by the CBN, and an investment of at least N50 billion through the InfraCo structure.
The CBN will engage the Nigeria Postal Service to utilise some of its assets to develop model warehouses across the federation.
The SteerCo has been granted the powers to co-opt any other ministry, department and agency of government to see to the effective implementation of the strategic turnaround plan.
Emefiele said the privatisation of the NCX was stopped because of the unfortunate arbitrage opportunities which the government has noticed in the private sector arrangement and which has become an obstacle in moderating food prices in Nigeria.
He said the NCX has not been able to serve as a catalyst for agricultural production due to several structural and idiosyncratic challenges which included limited funding and investment; poor financial performance and deficiency in physical infrastructure such as warehouses, laboratories and grading capability; inadequate warehouse receipts and logistics infrastructure.