We'll Do Away with Mercantilism in Banking, Says Obasanjo
From Josephine Lohor in Abuja
President Olusegun Obasanjo yesterday took a hard knock on the banking industry declaring that the battle to "do away with rent-seeking and mercantilism in banking" must be won at all cost.
The president while receiving the management and principal shareholder of OMATEK Computers, an indigenous manufacturing and assembly company led by Mr. Fola Adeola, a former Managing Director of Guaranty Trust Bank (GTB) at the State House, also emphasised that "we must win the battle of putting money in the productive sector like manufacturing, agriculture, industry and information technology (ICT)," instead of allowing banks to be playing "mago mago."
Obasanjo, while praising OMATEK for their "vision and courage", noted that he was giving the commendation "because if you (OMATEK) go into banking, you do not need any courage to succeed. You do not even need a lot of vision. Banks use our money and we must tell them how to apply it."
"In a situation where we change, we need courage and we need belief in God. When I went into agriculture, it was good. But it is as if we have a policy that first destroys, then we revert to importing what we are sufficiently producing in Nigeria," he said.
The president also praised the founder of OMATEK, Mrs. Florence Seriki, for her "courage and vision." He added that "what you are doing today is good, but almost everything comes from outside. It is the old way of import substitution and we must avoid the mistakes of the past."
The president also declared that the Federal Government was engaged in a battle to channel more funds to the productive sectors of the economy. He added that the government would implement policies and measures that would encourage Nigerian entrepreneurs invest more in productive ventures rather than engaging in only buying and selling or serving as commissioned agents to foreign interests.
"We must win the battle to put more money into the productive sectors of the economy," he noted, and urged Seriki to do more to follow the trail-blazing example of India's information technology giants.
Obasanjo, while advising that the productive sector should never be allowed "to die again", said bankers like the Managing Director of Zenith Bank, Mr. Jim Ovia, must believe in what they were doing.
"Jim, I thank God that you have increased the capital base of your bank and so, you would not go down the drain. I hope the response has been good?" he asked.
He also declared that "thank God, OMATEK loan was based on equity. If you had borrowed money on interest, they will charge 25 per cent and there is no way you borrow money at 25 per cent and break even. There is no way! And this is what they are doing to kill the economy of this country. Get more equity from them, but do not let them take control of your firm."
"The only thing bankers do is to have air-conditioned room, wall-to-wall carpet, they sit down there and you go to them, they speak grammar and they charge you big interest that you can not pay back," Obasanjo added.
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