PROCEDEDINGS AT 19TH NATIONAL LEASE CONFERENCE

PROCEEDINGS AT THE 19^TH NATIONAL LEASE CONFERENCE ORGANISED BY THE EQUIPMENT LEASING ASSOCIATION OF NIGERIA (ELAN), HELD AT SHERATON HOTEL, IKEJA – LAGOS AND VIRTUAL ON TUESDAY, 16^TH NOVEMBER, 2021

 

1.0      BACKGROUND

 

As part of its objective of promoting the ideals of leasing in Nigeria, the Equipment Leasing Association of Nigeria (ELAN) organised its 19^th National Lease Conference held on Tuesday, 16^th November 2021. The event was held both as in-person and virtual, at Sheraton Hotel, Ikeja – Lagos. The theme of this year’s conference was “EMERGING FROM THE COVID 19 PANDEMIC: LEASING AND THE NIGERIAN ECONOMY.

 

Every year, stakeholders in the leasing industry gather at the National Lease Conference to discuss pertinent and contemporary issues that affect the development of the leasing industry and the economy. As the biggest gathering of stakeholders, the National Lease conference remains a veritable platform for propagating the ideals of leasing and engagements, to propel the development of the leasing industry and the national economy.

 

This year’s conference was organised on the heels of the scourge of the pandemic that ravaged the world and continues to impact the global socio-economic development.

 

The conference considered among other things, the relevance of leasing to achieving the various policy initiatives of Government, especially at this crucial time of reflating the economy, and issues affecting the development of the leasing industry to further strengthen its capacity to contribute more to national development.

 

The conference attracted quality participation from high-net-worth professionals, both locally and globally, players from leasing industry, public sector, development partners, business community etc. Four major paper presentations were made by erudite experts, supported by a panel discussion handled by distinguished Panelists. Topics presented and discussed include:

 

• The Role of Leasing in Stimulating Development of the Nigerian Automotive Industry – Aissatou Diouf, General Manager, CFAO Motors
• Harnessing the Emerging Opportunities for the Nigerian Leasing Industry: Strategies and Impact Analysis – Jude Monye, Executive Director, Business Banking and Executive Compliance Officer, Heritage Bank Limited
• Minimising Risks in a Volatile Environment: The Leasing Initiative – Andrew Otike-Odibi, MD/CEO C&I Leasing Plc
• Evaluating the Impact of Equipment Leasing on Economic Development: Key Drivers and Militating Factors – Magan Jugurnauth, CEO Infinite Capital, Canada
• The Leasing Industry in Post Covid 19 Economy: The Way Forward. The Panelists were: Debola Agunbiade (Mrs), Managing Director/CEO CandourCrest Africa Limited; Adeleke Adebayo, Managing Director/CEO Opticom Finance Limited; Jonathan Gigin, Senior Financial Sector Specialist/Regional Manager Programme, International Finance Corporation (IFC) and Adenike Ibirogba (Mrs), Managing Director/CEO Nikky Taurus Nigeria Limited. The session was moderated by Alfred Okugbeni, Chairman, ELAN Board’s Programme Committee.

 

2.0       OBSERVATIONS

 

Conference observed that:

 

1. Leasing has been supporting economic development. Today, the impact of leasing is pronounced in all sectors of the economy, enhancing capital formation, generating employment and creating wealth. Essentially, Leasing has direct positive correlation with investment, gross domestic product (GDP) and value creation.

 

2. There is a link between the growth of automotive industry and the leasing sector, as leasing drives growth in the sector. Apart from vehicle production, other gaps in the automotive industry such as maintenance; supply of equipment and components to local manufacturers; vehicle distribution system; vehicle leasing and fleet outsourcing, provide immense opportunities for investors.

 

3. There is a need to build a sustainable leasing industry supported with the right policies that are not only favourable to vendors, lessors and lessees but is integral to national development.

 

4. Leasing has a major role to play in supporting Government’s efforts at addressing the infrastructure gap, which requires significant investment. Nigeria needs to invest about US$3 trillion in infrastructure over the next 30 years.

 

5. There are huge opportunities for the leasing industry which cut across several sectors of the economy including Oil and Gas, Construction, Manufacturing, Transport and Logistics, Agriculture, while new opportunities are emerging in areas of Health, Telecommunications, mining and Education. Essentially, the wide financing gap in the economy will continue to present immense opening for the industry.

 

6. Funding, knowledge gap, leasing infrastructure, are some of the major constraints that impede the capacity of the industry to effectively tap into the various opportunities in the economy.

 

7. The Credit Bureaus are essential in providing relevant information that will facilitate credible and faster risk assessment of lessees leading to timely consummation of transactions.

 

8. The full implementation of the Equipment Leasing Act 2015, especially, the inauguration and commencement of operation of the Equipment Leasing Registration Authority, will enhance the realisation of the developmental objectives of the Act and boost leasing activities.

 

3.0       CONSEQUENTLY, CONFERENCE RESOLVED AS FOLLOWS:

 

1. Government at all levels should utilise equipment leasing for the overall improvement of the economy – facilitating growth, enhancing infrastructural development, and creating wealth. The leasing industry is willing to collaborate with Government to achieve the set out economic initiatives.

2. In view of the relevance of leasing to economic development, it is imperative for Government to focus on the leasing industry by taking targeted measures that would stimulate more contribution from the industry. Recommended measures include:

 

• facilitate appropriate funding mechanism – establishment of National leasing fund, access to various intervention funds and pension fund etc

 

• Formal inauguration and commencement of operation of the Equipment Leasing Registration Authority.

 

• Utilisation of leasing in public sector to achieve efficiency and cost savings and incentivise lease investments in critical areas such as agriculture, health and mining, through access to cheap funding, tax rebate and providing risk mitigants.

 

3. It is important for the lessors and the industry as a whole to strengthen capacity to be more relevant, achieve corporate objectives and contribute more to national development. This will involve:

• Constructive engagement with market and relevant stakeholders
• Effective risk management to protect portfolio and quality of transaction. Lessors can leverage on the information from the Credit Bureaus in this regard.
• Strengthening internal capacity to improve processes and performance supported by sound corporate governance
• Being competitive in niche market, innovative and developing suitable products to meet customers’ needs
• Leverage on technology to improve processes and meet customers’ demand.
• Collaboration amongst lessors including pooling of resources to finance transactions under syndicated lease arrangement. In the long run, re-capitalisation of leasing companies just like banking and insurance industries, will be a major boost to addressing the funding challenges
• ELAN deepening of its advocacy and lease awareness campaign. This will include engaging Government and other relevant stakeholders, to create more favourable operating environment, visibility for the industry and promote the ideals of leasing.

 

  

4. Conclusion

 

Conference recognised and established the catalytic role of leasing in economic development and is apt in Nigeria’s efforts to revamp the economy. While the opportunities the economy present for the leasing industry are real, the capacity of the industry to fully exploit and meet the huge demand for capital assets appears limited. Overcoming this, will require the collective engagements of stakeholders. With the leasing industry redefining its course, developing and adopting appropriate strategies supported by Government policies and goodwill from development partners and other stakeholders, achieving the growth potential and full developmental impact of leasing, is guaranteed.

 

 

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