The Central Bank of Nigeria (CBN), Governor Godwin Emefiele yesterday said the bank planned to raise a Biofuel Industry Equity Fund (BIEF) of $50 billion.
Government parastatals, development banks including Bank of Industry (BoI), Bank of Agriculture (BoA) and Development Bank of Nigeria (DBN) will also finance biofuel production in the country.
Represented by Director of Research at the CBN, Mr. Lawrence Odeh, during the National Capacity Building & Sensitisation Workshop on Biofuels, which the Petroleum Products Pricing Regulatory Agency (PPPRA) organised in Abuja, Emefiele said a document already outlined a range of funding arrangement.
He said: “On the domestic front, it is instructive to know that the Nigerian biofuel policy and incentive draft document had outlined a range of funding arrangements and incentive packages for firms involved in biofuel production.
“The document envisages that equity funding arrangement to be known as BIEF of $50billion and to be purely funded by parastatals and development banks, including BoI, BoA and DBN.”
The apex bank chief noted that the scope of funding sources have become irrelevant as development partners such as United Nations Development Programme (UNDP), United Nations Environmental Programme (UNEP) and the UN habitat are now actively involved.
He said these multilateral agencies have been known to provide assistance to some African countries both technically and financially.
He added that both the private and the public sectors are partnering to have the required funding for the development of the biofuel sector, which will ensure the efficient deployment of resources and best judgement in business and investment decisions.
For this model to be effective, he said there has to be a vibrant private and institutional equity investment outlets alongside relevant source of regulations guiding their operations.
