By Cynthia Ezekwe.
Olukayode Pitan, the managing director, Bank of Industry (BoI),has called for specialised funding as well as the use of creative ideas and collaboration by Development Finance Institutions (DFIs) to overcome the financing gaps in addressing the economic transformation Nigeria needs.
Pitan, who is also the chairman, Association of Nigerian Development Finance Institutions (DFIs), made the advocacy during his presentation at the third Association of Nigeria DFIs’ annual general assembly held recently in Abuja.
The BOI MD observed that as the country strives to achieve sustainable development goals and address global challenges, the traditional financing models have become inadequate.
He, however,noted that by utilising specialised funding arrangements,complemented by non-financial services, DFIs are able to act as growth catalysts to the development of the Nigerian economy.
According to Pitan, challenges such as specific market failures and institutional barriers prevent private investment from flowing to developing countries due to asset deterioration, weak corporate governance and risk management frameworks.
He pointed out that multilateral institutions have a critical role to play in coordinating efforts, mobilising resources and ensuring the effective implementation of innovative financing mechanisms.
“Therefore, we must continuously work together, leveraging on our expertise, resources, and networks to unlock transformative projects by working in synergy with the organised private sector and our respective governments,” he said.
Using the Bank of Industry as an example, he recalled that over the years, the bank has successfully raised funds from the international capital market, which has allowed it to not only fill critical gaps and provide the necessary funding for transformative projects, but also exposed it to global best practices and innovative solutions that promote institutional development, and improve the effectiveness of developmental initiatives.
“Since the Bank of Industry commenced its innovative financing mechanism, the total assets have grown significantly by 381 per cent between 2017 and 2023 (H1), reaching N2.38 trillion by the end of year 2022 and closing at N3.29 trillion as at June 2023,’’ the BOI chief added.
He further advocated the exchange of technical expertise between DFIs members and similar organisations globally, prioritising professional advancement while leveraging the knowledge from best-in-class economies as ways of deepening innovative financing.
