Economy
CBN Forex Exclusion Policy Dangerous to Economy—LCCI
By Dipo Olowookere
The Central Bank of Nigeria (CBN), in order to stimulate economic growth and boost local production in the country, restricted the supply of foreign exchange (forex) to some items that can be easily produced in Nigeria.
This gave rise to the 43 items on the forex restriction list. What this means is that importers of items on the list would not be able to get foreign exchange directly from the windows created by the apex bank to bring the products into the country, but only at the black market.
Recently, the central bank announced the addition of milk to the list and this generated mixed reactions from Nigerians, experts and economists.
Also commenting on the matter was the Lagos Chamber of Commerce and Industry (LCCI), which said the forex restriction policy of the CBN was harmful to the nation’s economy.
According to the agency, Nigeria is not ripe for the forex restriction policy on milk importation because it would create a crisis of immense proportions in the dairy industry supply chain and put investments worth billions of dollars at risk.
The LCCI noted further that the policy will do more harm than good, both to investors and the citizens because it would trigger avoidable disruptions and dislocations in the investment environment and further undermine investors’ confidence and create huge supply gaps in the market with severe harmful consequences.
“We currently do not have dairy cows in the country. The dominant milk producing system in Nigeria is the Fulani Nomadic System whose cows have a milk yield of less than two litres a day; whereas, a good dairy cow will produce an average of 28 litres of milk per day over 10 months.
“During peak lactation, a high yielding dairy cow can produce as high as 60 litres of milk per day. The reality is that Nigerian cows have very low yield because of poor genetic composition, poor feeding practices and the laborious nomadic system of breeding. These are fundamental issues that we need to fix before contemplating any form of import restriction.
“These are challenges to be posed to the Federal Ministries of Agriculture and Water Resources at the federal and state levels as the present administration moves to the next level. These are the agencies of government that have primary responsibilities for such matters. The environment needs to be created for these investments to happen,” the agency said in a statement to react on the matter.
In the statement signed by its Director General, Mr Muda Yusuf, the LCCI warned that the policy could lead to a massive job loss, pointing out that, “There are over one million direct and indirect jobs that will be in jeopardy across the value chains of these industries.”
“These companies engage Nigerians as employees, distributors and retailers as well as thousands of suppliers and service providers who are dependent on these businesses for their livelihood. For a country that is grappling with unemployment crisis, the consequences will be too grave. Therefore, there are profound investments, economic, nutritional and social issues to worry about,” it said.
The agency said additionally, such policy will boost the smuggling economy since there will be an estimated 50 percent short fall in the supply of dairy products to the Nigerian market, with the supply gaps creating scarcity and put the prices of the products beyond the reach of the average Nigerian.
It further warned that there would be loss of revenue to the government as smugglers naturally move to fill the supply gaps in the market, adding that there is a major risk of closure/drastic scaling down of operations of existing investments in the dairy industry.
According to the LCCI, there will be a higher risk of malnourishment of citizens especially children and the low-income earners, heightened risk of loss of jobs in the dairy sector, while neighbouring countries will profit from the increased smuggling triggered by the policy, as the Nigeria ports and maritime sector workers loose revenue and jobs to the ports of the neighbouring countries.
In the statement, the LCCI urged the CBN to give enough timeline to diary companies for a sustainable transition from the current state of affairs to the desired level of backward integration in the dairy industry.
“There should be robust incentives to attract investors to the supply chain in the dairy industry in line with the backward integration aspiration.
“The ministries of Agriculture and Water resources should take on the challenge of driving this change process through the creation of incentives for modern animal husbandry facilities and practices.
“There should be generous support from government to facilitate the importation of cattle breed [dairy cows] suitable for milk production, it said.
“On account of the foregoing, we urge the CBN to put on hold its proposal to exclude the dairy industry investors from the foreign exchange market in order to save the economy of the consequential shocks, business disruptions, investment dislocations and job losses,” the LCCI concluded in the statement.
By Adedapo Adesanya
The World Bank has approved a $500 million facility for Nigeria to expand longer-term lending to small and medium sized businesses.
Approved under the Fostering Inclusive Finance for MSMEs in Nigeria (FINCLUDE) project, the package comprises a $400 million International Bank for Reconstruction and Development (IBRD) loan and a $100 million International Development Association (IDA) credit. Both IBRD and IDA are members of the World Bank Group.
The scheme will be implemented by the Development Bank of Nigeria (DBN), with credit guarantees provided through DBN’s subsidiary, Impact Credit Guarantee Limited (ICGL).
FINCLUDE is designed to address constraints faced by micro, small, and medium enterprises (MSMEs) in Nigeria which despite accounting for most businesses and nearly half of gross domestic product (GDP) face long-standing barriers to formal finance.
Fewer than one in 20 MSMEs have access to bank credit; loans are often short-term and costly; and collateral requirements exclude many viable firms. Women-led enterprises, which make up a substantial portion of MSMEs, are disproportionately affected, facing higher rejection rates and limited tailored products. Agribusinesses, central to food security and rural livelihoods, similarly struggle to obtain more extended‑tenor financing for equipment, processing, storage, and logistics.
However, FINCLUDE seeks to address these constraints by expanding access to affordable, longer-term finance and tailored solutions for segments with the most significant development impact.
Speaking on this, the World Bank Country Director for Nigeria, Mr Mathew Verghis, said, “FINCLUDE is about jobs, opportunity, and inclusion. By expanding access to finance for viable MSMEs—particularly women-led firms and agribusinesses—Nigeria can accelerate growth and deliver tangible benefits across communities nationwide.
“The project will make it easier for deserving small businesses to get the finance they need to grow and hire workers. With better support for lenders that practice inclusive finance and fairer, longer-term loans for entrepreneurs, we are backing the people who power Nigeria’s economy—especially women and those in agriculture.”
The FINCLUDE project will help to mobilise private investment and expand access to and usage of inclusive, innovative financial products for MSMEs nationwide.
Through DBN, the operation will strengthen the capacity of banks, including microfinance banks and non-bank financial institutions such as financial technologies (fintechs), to provide larger loans with more reasonable repayment periods, and—through ICGL—will scale partial credit guarantees so that lenders can extend credit to businesses they might otherwise consider too risky.
Targeted technical assistance will modernise loan appraisal by leveraging AI-enabled digital platforms to accelerate decision-making, improve data quality, strengthen impact measurement, and build capacity for both MSMEs and participating financial institutions.
According to the World Bank, a strong emphasis on inclusion will ensure that women-led businesses and agribusinesses benefit from these improvements.
Also commenting, Task Team Leader for FINCLUDE, Mrs Hadija Kamayo, said, “FINCLUDE will help to mobilize approximately $1.89 billion in private capital, expand debt financing to 250,000 MSMEs—including at least 150,000 women-led businesses and 100,000 agribusinesses—and issue up to $800 million in guarantees to catalyse lending.
“By extending the average maturity of MSME loans to about three years, it will help firms invest in equipment, factories, staff, and productivity, translating finance into jobs and growth.”
By Dipo Olowookere
The local stock market firmed up by 1.13 per cent on Friday as appetite for Nigerian stocks remained strong.
Investors reacted well to the 2026 budget presentation of President Bola Tinubu to the National Assembly yesterday, especially because of the more realistic crude oil benchmark of $64 per barrel compared with the ambitious $75 per barrel for 2025. This year, prices have been between $60 and $65 per barrel.
Business Post observed profit-taking in the commodity and energy sectors as they respectively shed 0.14 per cent and 0.03 per cent.
But, bargain-hunting in the others sustained the positive run, with the consumer goods index up by 3.82 per cent.
Further, the industrial goods space appreciated by 1.46 per cent, the banking counter improved by 0.08 per cent, and the insurance industry gained 0.04 per cent.
As a result, the All-Share Index (ASI) increased by 1,694.33 points to 152,057.38 points from 150,363.05 points and the market capitalisation chalked up N1.080 trillion to finish at N96.937 trillion compared with Thursday’s closing value of N95.857 trillion.
A total of 34 shares ended on the advancers’ chart, while 24 were on the laggards’ log, representing a positive market breadth index and bullish investor sentiment.
Austin Laz gained 10.00 per cent to close at N2.42, Union Dicon also jumped 10.00 per cent to N6.60, Tantalizers increased by 9.80 per cent to N2.69, Aluminium Extrusion improved by 9.78 per cent to N12.35, and Champion Breweries grew by 9.71 per cent to N16.95.
Conversely, Sovereign Trust Insurance dipped by 7.42 per cent to N3.87, Royal Exchange lost 6.84 per cent to trade at N1.77, Omatek slipped by 6.84 per cent to N1.09, Eunisell depreciated by 5.88 per cent to N80.00, and Eterna dropped 5.63 per cent to close at N28.50.
Yesterday, traders transacted 1.5 billion units worth N21.8 billion in 25,667 deals compared with the 839.8 million units sold for N32.8 billion in 23,211 deals in the preceding session, showing a surge in the trading volume by 76.61 per cent, an uptick in the number of deals by 10.58 per cent, and a shrink in the trading value by 33.54 per cent.
By Adedapo Adesanya
Three stocks stretched the bearish run of the NASD Over-the-Counter (OTC) Securities Exchange by 1.21 per cent on Friday, December 19, with the market capitalisation giving up N26.01 billion to close at N2.121 billion compared with the N2.147 trillion it ended a day earlier, and the NASD Unlisted Security Index (NSI) dropping 43.47 points to 3,546.41 points from 3,589.88 points.
The trio of FrieslandCampina Wamco Nigeria Plc, Central Securities Clearing System (CSCS) Plc, and NASD Plc overpowered the gains printed by four other securities.
FrieslandCampina Wamco Nigeria Plc lost N6.00 to sell at N54.00 per unit versus N60.00 per unit, NASD Plc shrank by N3.50 to N58.50 per share from N55.00 per share, and CSCS Plc depleted by N2.91 to N33.87 per unit from N36.78 per unit.
On the flip side, Air Liquide Plc gained N1.01 to close at N13.00 per share versus N11.99 per share, Golden Capital Plc appreciated by 70 Kobo to N7.68 per unit from N6.98 per unit, Geo-Fluids Plc added 39 Kobo to sell at N5.50 per share versus N5.11 per share, and IPWA Plc rose by 8 Kobo to 85 Kobo per unit from 77 Kobo per unit.
During the trading day, market participants traded 1.9 million securities versus the previous day’s 30.5 million securities showing a decline of 49.3 per cent. The value of trades went down by 64.3 per cent to N80.3 million from N225.1 million, but the number of deals jumped by 32.1 per cent to 37 deals from 28 deals.
Infrastructure Credit Guarantee Company (InfraCredit) Plc finished the session as the most active stock by value on a year-to-date basis with 5.8 billion units valued at N16.4 billion, followed by Okitipupa Plc with 178.9 million units transacted for N9.5 billion, and MRS Oil Plc with 36.1 million units traded for N4.9 billion.
The most active stock by volume on a year-to-date basis was still InfraCredit Plc with 5.8 billion units worth N16.4 billion, trailed by Industrial and General Insurance (IGI) Plc with 1.2 billion units sold for N420.7 million, and Impresit Bakolori Plc with 536.9 million units traded for N524.9 million.
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