Is Nigeria’s $200 Billion Non-Oil Earnings Plan Heading In The Right Direction?

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News in brief: The CBN’s RT200 initiative appears to be on the right track to raise $200 billion over the next 3-5 years from non-oil export proceeds. Look at its impressive numbers so far and potential challenges.

Godwin Emefiele, the Governor of the Central Bank of Nigeria (CBN), believes that the RT200 initiative is showing ‘impressive prospects’. His confidence comes from the huge numbers the plan has been posting.

What is the CBN RT200 initiative?

It is a monetary policy intervention that the CBN introduced in February 2022 to shore up Nigeria’s exchange rate and boost the Foreign Exchange (FX) Reserves. The plan is to raise $200 billion in Foreign Exchange earnings from non-oil export proceeds over the next 3-5 years.

There is a rebate scheme attached to the initiative to encourage non-oil exporters. The CBN pays ₦‎65 per $1 repatriated and sold at the investors and exporters’ (I&E) window to Authorised Dealer Banks (ADB) and ₦‎35 per $1 repatriated and sold into the (I&E) window for exporters to use on eligible transactions.

Commercial banks act as ADBs and ensure that they authenticate documents summitted, determine eligibility of products and exporters, and verify exporters due for rebate payments.

Meanwhile, a caveat of the plan is that all the products, goods and services must be finished or semi-finished goods that are partly processed or fully manufactured in the country. Also, they must not be on the export prohibition list.

A look at the RT200 plan so far

At a recent summit of stakeholders, the bank’s top executive made some impressive declarations. In its first two months, the initiative realized $62 million but that grew into $600 million in the following three months, which was the second quarter of 2022. By the third quarter, it posted $900 million.

“Available data shows that repatriation due to the programme increased by 40 per cent from $3 billion in 2021, to $5.6 billion at the end of 2022. The momentum for 2023 is equally showing strong numbers and impressive prospects,” Emefiele said.

2023’s first quarter has resulted in $1.7 billion already, as the CBN governor claimed at the ‘RT200: Challenges and Prospects to Success’ summit in Lagos state. He added that nearly $790 million has been traded at the investors and exporters’ (I&E) window year-to-date, that is January 2023 to May 2023.

The money coming in from the initiative represents inflows, which in this case is the amount of foreign currency that is entering the country’s economy. However, the question is, who is benefitting from its rebate scheme? Where is the money going to?

Emefiele said that the bank would begin publishing beneficiaries a week after the summit to foster transparency. As for the second half of the reason for the summit, he appealed to would-be rebels not to export without documentation. He further threatened to place PND restrictions on accounts that engage in acts that could cause problems for the initiative.

Obinna Onwuasoanya
Obinna Onwuasoanya
Obinna Onwuasoanya is a tech reporter of over five years, fiction writer, SEO expert and an editor. He is based in Lagos, Nigeria, and was previously shortlisted for the Writivism Short Story Prize 2018.

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