By Babajide Komolafe
A financial expert, Mr. Lucky Aiyeda-tiwa, has called for the speedy implementation of the N500bn power sector intervention fund.
It would be recalled that the Monetary Policy Committee, MPC,Â of the Central Bank of Nigeria, CBN, announced that the apex bank would provide N500bn facility for investment in debentures issued by the Bank of Industry (BOI) in accordance with Section 31 of the CBN Act 2007, for investment in emergency power projects dedicated to industrial clusters.
Commenting on this initiative, Aiyedatiwa said that it is a very laudable initiative that will impact positively on the economy, but warned against bureaucratic bottleneck in the implementation.
Aiyedatiwa, who is also theÂ Managing Director/Chief Executive, Bluewall BDC, said â€œbe it as it may, it is going to positively impact on the economy. Though it is meant for power project, there would be a ripple effect on other sectors to generate economic activities.
â€œAnd donâ€™t forget the moment the power sector is fixed, in the long run, the small and medium scale enterprises, which are the catalyst for economic growth, will begin to find their feet.
â€œSo if power sector and infrastructure are put in place, then doing business will be easier, the enabling environment will be there and even the security system will improve as it would enable us to operate certain gadget that will create certain security or protection.
â€œThe cost of doing business will reduce because if the various sectors are doing well, the banks will be able to lend more money out and that will begin to increase business activities.â€
He however expressed concern that the implementation is vulnerable to administrative bottlenecks, noting that the fact that a committee of various stakeholders still have to work out the modalities implies that the implementation might not be as soon as expected.
He noted that the fund will first have to go through the Bank of Industry, which will create a debenture, then the banks will have to apply for the loan. But before they apply, they must first assess the projects to be funded, and carry out the cost and benefit analysis.
All these would definitely take time, he said, adding there is need for the CBN to ensure the initiative is not weighed down with procedural formalities and red tape requirements so that the impact of the fund would be felt before year end.
He also called for an extension of the fund to power projects in industrial areas in south west states of Ondo, Ogun, Oyo, Osun and Ekiti states, adding that there are industrial clusters in these states that require regular power supply.
He gave the example of the Ore mega city being planned by the Ondo State, to transform the ancient and strategically located city of Ore.