FICAN Conference 2024: A Call for Bold Reforms as Nigeria Aims for a $1 Trillion Economy

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The National Chairman of the Finance Correspondents Association of Nigeria (FICAN), Mr. Chima Titus Nwokoji, On September 28, 2024, at Orchid Hotels in Lekki, Lagos, delivered a compelling welcome address at the association’s annual conference. This year’s theme, “Nigeria’s Journey Towards a $1 Trillion Economy: Impacts of Banks’ Recapitalization for Fintechs and the Real Sector,” reflects the urgent need for transformative reforms to meet the nation’s economic ambitions.

Nwokoji highlighted the significance of last year’s conference, which centered on “Strengthening Digital Infrastructure for Efficient, Innovative Payment Systems in Nigeria.” He emphasized that the discussions and articles generated from that event served as valuable resources for policymakers and industry leaders. This year, the conversation shifts to the critical role of banking reform in fostering Nigeria’s economic growth.

With Nigeria currently ranked as the fourth-largest economy in Africa by the International Monetary Fund (IMF), Nwokoji outlined the necessary steps toward achieving a $1 trillion economy by 2025 or 2026. He pointed to the recapitalization of banks as a crucial measure to enhance financial intermediation and support for fintechs and the real sector, estimating that this initiative could inject approximately ₦3.3 trillion into the banking system, generating significant economic multiplier effects.

Citing global best practices, Nwokoji referenced Singapore’s banking sector, which has been pivotal in transforming the nation into a financial hub. He expressed optimism that recapitalized banks in Nigeria would lead to increased lending to micro, small, and medium enterprises (MSMEs), enhanced support for fintechs, improved credit facilities for agriculture and infrastructure, and bolstered investor confidence to attract foreign direct investment.

However, the FICAN Chairman also raised concerns about exchange rate fluctuations, noting the depreciation of the naira over the years. He cited the IMF’s analysis indicating a yearly decline of 10.6% since 1973, warning that without strong macroeconomic indicators, the country may face another recapitalization round within the next five to ten years due to currency volatility.

Additionally, Nwokoji addressed regulatory challenges, particularly the recent exclusion of retained earnings from capital calculations, which has drawn criticism from the Institute of Chartered Accountants of Nigeria (ICAN). He underscored the importance of revisiting these policies to align with international financial standards.

The proposed 70% windfall tax on profits generated from foreign exchange transactions was also a point of contention, with the Bank Directors Association of Nigeria (BDAN) deeming it excessive and ill-timed, he added.


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