In a bid to shore up foreign exchange base, banks are encouraging their customers in the agricultural sector to explore export opportunities in Asia and Europe to boost their revenue profiles, the Nation has learnt.
This is coming as a result of the protracted crash in the value of the naira and drop in revenues following the withdrawal of government deposits.
Foreign exchange earnings from agribusiness have grown substantially following the increase in export price and value of some products and weaker naira exchange rate has improved the competitiveness of agricultural commodity exporters.
Chairman, Multimix Academy, Dr Obiora Madu, said exporters, especially agricultural producers, were taking advantage of this. Since naira has weakened considerably against the currencies of some of the nation’s major trading partners, such as Europe, Asia and the United States (U.S), agricultural exports have become more competitive in these markets.
Following this, finance service operators are offering what they claim are better deals in handling money transfers or providing currency brokering advice for a diverse new class of small to mid-sized farm products exporters.
The situation is encouraged by the fact that government is insisting on agro exporters using banks for foreign currency transactions.
Madu said with foreign exchange becoming scarce, agro exports were proving a to be a lifeline as global trade volumes continue to rise, as well as earnings by farmers and exporters.
He noted that the growth of agric exports is one of the success stories of the economic crisis. This has prompted banks to assemble teams focused on exporters, with small to medium exporters exploring global markets, Madu added.
Addressing an agro export seminar in Lagos, Head, Structured Trade and Export Finance at Zenith Bank, Godwin Essien, said agricultural exports would continue to dominate the nation’s foreign trade given the structure of the economy.
He said farm exports were growing in value as exporters rush to sell a wider choice of produce to growing economies.
Essien emphasised the need for more efforts at increasing the value of exports as well as the volume.
He said to facilitate this, the bank was providing agricultural businesses with one-stop banking services, including the issuance of letters of credit and loans denominated in foreign currencies.
