The Centre for the Promotion of Private Enterprise (CPPE) has urged the federal government and the Central Bank of Nigeria (CBN) to overhaul the country’s development finance framework, warning that Nigeria’s productive sectors face a financing shortfall of more than N50 trillion.

In a policy brief released on Sunday and signed by CPPE’s CEO, Muda Yusuf, the advocacy group argued that the country’s current financial system cannot provide the affordable, long-term funding needed by manufacturers, farmers, agribusinesses, exporters, and micro, small, and medium-sized enterprises (MSMEs).

CBN had earlier curtailed its development finance interventions to concentrate on its primary mandate of ensuring price and monetary stability.

The organisation, CPPE, said the financing constraints stem from structural market failures rather than a shortage of liquidity, citing high lending rates, short loan tenors, stringent collateral requirements, limited risk appetite among lenders and inadequate patient capital.

“CPPE estimates a conservative current real-sector financing gap of over N50 trillion when account is taken of unmet financing needs across manufacturing, agriculture, agribusiness, MSMEs, supply chains and export-oriented enterprises,” CPPE stated.

According to the group, agriculture contributes more than one-fifth of Nigeria’s Gross Domestic Product (GDP) but has historically received less than five per cent of total banking sector credit, while manufacturers require medium- and long-term financing to invest in machinery, technology, factory expansion, energy infrastructure and export development.

It argued that such investments cannot be financed sustainably through short-term commercial bank loans offered at prevailing interest rates.

Financing constraints

CPPE said the current monetary policy stance has further widened the financing gap, noting that the CBN’s benchmark Monetary Policy Rate (MPR) of 26.5 per cent and the Cash Reserve Requirement (CRR) of 45 per cent for deposit money banks have pushed commercial lending rates beyond levels that many productive investments can support.

While acknowledging that the CBN’s monetary tightening has improved policy credibility, exchange-rate stability and inflation management, the organisation said monetary stability should ultimately support economic growth rather than constrain productive investment.

“Price stability and development finance should not be treated as mutually exclusive objectives. In an economy characterised by deep financing gaps, market failures and severe supply-side constraints, monetary stability must be complemented by carefully targeted, transparently governed and non-inflationary development finance interventions to support manufacturing, agriculture, agribusiness and other strategic productive sectors,” CPPE said.

It added that Nigeria faces the difficult task of maintaining restrictive monetary conditions to contain inflation while ensuring businesses have access to affordable, long-term capital needed to expand production and create jobs.

“The answer is not indiscriminate monetary expansion. It is a carefully designed development-finance framework targeted at identifiable market failures and structured to preserve monetary-policy credibility,” CPPE said.

Drive industrialisation

The organisation argued that expecting conventional commercial banks to finance Nigeria’s industrialisation and agricultural transformation is unrealistic because banks largely mobilise short-term deposits, whereas productive sectors require financing extending over five to ten years or longer.

It also identified information asymmetry, heavy dependence on landed property as collateral, and sovereign borrowing as key factors discouraging lending to productive businesses.

“Commercial credit decisions, driven primarily by risk-adjusted private returns, tend to underfund productive sectors relative to their broader economic and social value.

This represents a classic market failure and provides a compelling economic justification for well-targeted development finance interventions,” it stated.

Reform

Although CPPE acknowledged governance shortcomings associated with previous CBN intervention programmes, including weak loan recovery, political interference, beneficiary selection challenges, and quasi-fiscal risks, it said those weaknesses justify reforms rather than abandoning development finance altogether.

“These shortcomings provide a compelling case for reform, not retreat. Implementation failures should not be confused with the absence of genuine market failures in Nigeria’s financial system,” the organisation said.

It proposed replacing direct intervention lending with a modern framework that is market-driven, transparent and anchored on risk-sharing.

Under the proposed model, the CBN would serve mainly as a catalyst, refinancer and risk-sharing institution, while development finance institutions and commercial lenders would retain responsibility for loan appraisal, disbursement and recovery.

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Recommendations

CPPE called on the government and the apex bank to strengthen the country’s development finance architecture by reconsidering the retreat from development finance and refraining from returning to discretionary intervention lending.

It also advised the apex bank to recapitalise and strengthen the Bank of Industry and the Bank of Agriculture to serve as the main channels for long-term financing.

CPPE urged the regulator to expand partial credit guarantees and risk-sharing schemes for manufacturing, agriculture, exports and MSMEs, while also creating specialised long-term refinancing windows for manufacturing and agricultural value chains.

It also asked the government to expand supply-chain financing, warehouse receipt systems, receivables financing, and movable collateral frameworks, and to improve credit information systems and technology-driven risk assessment.

The advocacy group urged the government to mobilise pension, insurance and capital market funds for productive, long-term investments and to reduce government borrowing that crowds out private-sector credit.

It added that the government should strengthen governance, transparency, loan recovery and independent performance evaluation.

Inflation control

CPPE also argued that properly designed development finance is compatible with the CBN’s price stability objective because much of Nigeria’s inflation is driven by structural supply constraints rather than excess demand.

“The critical distinction is between financing consumption, which principally expands demand, and financing productive capacity, which expands supply,” it stated.

The organisation said financing investments in agriculture, manufacturing, energy, storage and logistics would increase productive capacity and help moderate inflation over time.

By Aderonke Ojo

Connor Tuodolo, Founder of the Squash Premier League and the Beacon of Positivity Foundation (BOPF), says the initiative aims to use squash as a tool to take children off the streets.

It is also to empower them with life skills and opportunities to shape them into responsible citizens.

Tuodolo said this to newsmen at the opening of the second edition of the Squash Premier League at Moshood Abiola National Stadium, Abuja.

The News Agency of Nigeria (NAN) reports that the tournament, themed “Breeding the Next Generation of Champions”, attracted 105 young athletes from squash academies across the country.

The week-long competition, which runs from Aug. 3 to Aug. 8, features the Under-15, Under-19, senior club members and doubles categories.

According to Tuodolo, the league was established not only to produce elite squash players but also to provide young Nigerians with positive opportunities through sports.

“We want organisations that believe in youth development to join us in taking children off the streets, empowering them through sports and creating opportunities for them to become productive citizens,” he said.

He said the initiative grew from his experience as a squash player, and his conviction that Nigeria needed a sustainable grassroots platform where young athletes could develop their talents through regular training and competition.

“What keeps us going is seeing these children smile and discover their potential. That is the greatest motivation for us,” he said.

Tuodolo said the league had recorded steady growth since its inception in 2025, with participation increasing from 26 athletes in the maiden edition to 105 competitors this season.

“When we started, we had only 26 athletes. The next competition attracted 45 players, followed by about 50, then 69, and now we have 105 participants. That shows the league is growing and that there is hope for squash in Nigeria,” he said.

He explained that the organisers deliberately limited participation to squash academies to encourage coaches to establish and strengthen grassroots development programmes across the country.

According to him, the league is organised three times annually during school holidays to provide young players with regular opportunities to compete and assess their development.

Tuodolo said the competition also incorporates coaching and officiating clinics for both players and officials in order to improve participants technical knowledge and understanding of the rules of the game.

He, however, identified inadequate funding as the biggest challenge confronting the initiative.

“Our biggest challenge is funding. Although I have a committed team working with me, many of them sacrifice their personal time and resources simply because they believe in giving these children opportunities,” he said.

He added that donor support had yet to meet the financial demands of the expanding competition.

“I had hoped donor funding would cover most of our expenses, but because the platform is still developing, much of the financial responsibility falls on me. It has been difficult, but giving up is not an option,” he said.

The league founder appealed to corporate organisations, particularly those in the oil and gas sector, to partner with the organisers through sponsorship.

“My appeal is to corporate organisations to support this initiative. By doing so, they will not only sustain the league but also invest in youth development and nation-building through sports,” he said.

Tuodolo added that BOPF also carries out community outreach programmes, including free eye tests and the distribution of medicated glasses, as part of its commitment to improving the lives of vulnerable people.

He expressed optimism that with sustained support, the league would become one of Africa’s leading grassroots squash competitions.

Some of the young participants described the championship as an opportunity to pursue their sporting dreams.

15 -year-old Edna Philip from Plateau said she hoped the competition would help her realise her ambition of becoming one of the world’s best squash players.

“I have been playing squash for three years, and I hope to become one of the best squash players in the world. I am grateful to my parents and my coach for supporting me,” she said.

16-year-old Nanme Rindaps, who finished as runner-up in the previous edition, said he returned to Abuja determined to improve his performance and win the title.

“I came here to learn new techniques, improve my game and compete for victory,” he said.

Another participant, Praise Chukwuemeka, thanked her parents for supporting her sporting career, expressing confidence that competing against stronger opponents would improve her performance.(NAN)(www.nannews.ng)

Edited by Joseph Edeh