ABSTRACT
This project work has critically highlighted the compact
of the Role of Banks International Trade in Nigeria, the problems affecting the
Role in Banks in international trade in Nigeria have been identified and how
they can be controlled is also includes in the study and ways to solve them are
inductive in the study.
This study also examines the lapses
and recommends some viable points (s) that can also contribute to the image of
the industry.
TABLE OF CONTENTS
Title page:
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Approval
page:
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Dedication:
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Acknowledgement:
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Abstract:
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Table of
contents: --------------------------------------------------------------------
CHAPTER ONE
1.0
Introduction:
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1.1 Background of the study:
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1.2
Statement of problem: -------------------------------------------------------
1.3
Objectives of the study:
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1.4
Research question:
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1.5
Assumption of the study: ---------------------------------------------------
1.6
Scope of study:
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1.7
Significance of the study:
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1.8
Limitation of the study:
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1.9
Definition of terms:
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CHAPTER TWO
REVIEW OF
RELATED LITERATURE
2.0
The role of banks in international trade in Nigeria:
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2.1 Definition of banks and international trade:
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2.2
Types of banks:
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2.3
Causes and problems of banks role in international
trade: ------
CHAPTER
THREE
RESEARCH
METHODOLOGY
3.0
Source of data:
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3.1 Location of data:
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3.2
Method of data collection:
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3.3
Analysis of data:
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CHAPTER
FOUR
4.0
Findings:
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CHAPTER FIVE
5.1
Summary:
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5.2
Conclusion: ------------------------------------------------------------------
5.3
Suggestions for further research:
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Bibliography:
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CHAPTER
ONE
1.0
INTRODUCTION
This project writ – up, “The role of Banks in international
Trade”, is written to provide a guide sufficiently instructive in scope to meet
the need for Banks, Economist in International Trade.
Among the important topics examined are if there are various
relationship, role that exist between banks and international trade in Nigeria,
nature of international economics, international trade, difference between
international trade and internal trade, problems facing international trade in
the banks sector.
1.1 BACKGROUND OF THE STUDY.
Nigeria before and even since the
British Colonialist of our country has been engaged in international trade. But
it was obviously spelt out during the British Colonialist that was in the 15th
century termed legitimate trade.
This was until 1960 during which Nigeria got its
independence. This means that, Nigeria was no longer controlled solely by the
dictates of the British Government Ever since then legitimate trade to the
Nigerian was changed to international trade of which Banks has a major role to
play in it.
Nigeria since the oil boom in the early 70’s has been
enjoying Nigeria and across the country. Diversifying its economy.
Apart fro international trade, and as a result of climatic
factors, Nigeria needs international trade to diversify, accelerate its
economic development in the country.
International trade ensures export expansion and import
contraction coupled with the fact that it stimulates foreign exchange earnings,
international recognition and the provision of employment opportunities for the
teeming population.
International trade is synonymous with the production of
goods and services for the benefit of trade across the country. Thus we have
the banking institution, the food processing export/import trade and the sugar,
tobacco export/import trade and that of petroleum export trade is not left
behind. Therefore, international trade or external trade is a trade between two
or more countries.
Example. Trade between Nigeria and USA as well as Ghana,
India, Britain, Japan etc. trade between two countries is called bilateral
trade, while trade between many countries is called multilateral trade.
International trade does not mean the exchange of goods and
services within a country. The exchange of goods and services among the people
of the same country is called home or internal trade. Example, all trading
activities which take place within Nigeria in a home or international trade.
External trade is established for the purpose of stabilizing
nation’s economy standard if living.
External trade has been proved beyond doubts as very
important for a nation’s survival therefore it is peevant that we explicably
manifest how the role of banks can be employed for the development of these
trade. In doing this, we will limit our study to short and long term scale
institutions which are very important to the economy.
Short term scale institutions ad defined by the central bank
credit guidelines is, any service enterprise whose annual business turnover
does not exceed N500,000.00 (five hundred thousand naira).
There is no definition for long term scale institutions as
these did not attract the direct emphasis of the CBN.
The role of banks in international trade development of
Nigeria, could be seen through the various services which these banks provide
for the sustenance of international trade in the country.
These services include the provision of capital for these
exporter/importers in the business inform of loans, such as short term loans,
medium and long term loans, which the traders could use to finance their
business goals.
The banks also provide overdraft facilities, which are
necessary to finance the working capital of the business.
An overdraft could be defined as an arrangement whereby the
banks allow their customers to over-draw his account up to a credit position at
the end of the period, while short term loans refer to loans granted for
periods between one to five years. Then medium and long term loans are granted
for periods between five to ten years, even ten years respectively.
Apart from granting loans and over drafts facilities, there
are still other roles which banks could play in international trade development
in Nigeria. These roles include professional advice, opening of documentary
letters of credit (L/CS), bills for collection and negotiation/open account and
bills of exchange, foreign exchange example travelers cheques and foreign
currencies, information on trade and exchange restrictions, collection and
transfer of funds status enquires, etc. above all the determination of the actual
external funds required by an export/import borrower. There are accepts of such
services which help international trade growth or expansion.
It is not for fetched that the exporters/importers of
international trade suffer their own bank problems, which should be analyzed
and solved to ensure international trade development. These problems such as
the problem of corruption in banking parastatals, obtaining capital from and
operational problems which are coursed by the dictates of the Nigeria environment
and society.
The irrational problem of manpower requirement and the poor
knowledge of trade across of these external traders help to compound the
general problems of international development of which bank services can be
gainfully employed for the purpose of solving them.
Addition to the problems is lost of trust ship among the
members or cooperators of the trade 4, 1, 9, problem among members.
In all, these problems the worst is the problems of unstable
political contradictions.
These problems should be totally exterminated by the
government, and the society entirely to ensure the steady growth of this
important sector of the business of the economy.
It has been noticed that the level of banks institutions
financing has been vary poor compared with is obtained in developed nations
such as America (USA), Germany but few. The central bank of Nigeria (C. B. N)
should step up their moral suasion policy so as to make these banks especially
the commercial banks to increase the level of their financing of exporter/importers
members.
In increasing this level of their financing emphasis should
be placed on medium and long term loans to enable these traders concretize
their investments for better results in its outputs; though the commercial
banks borrow short from their deposits, the commercial banks who also declare
excess profits at the end of each year should expand a lading pattern for
medium and long terms loans without adversely affecting their liquid ratios.
With the funds available from the banks, international
traders should be made to judiciously invest them and with other important a
sound, solid firm and concrete foundation must be laid for the international
development of the country.
1.2 STATEMENT OF PROBLEM
The Nigerian Banks plc is a pillar in the roles contributed
to international trade in Nigeria. The Nigerian banks have various established
institutions that enhance the growth of international trade.
Commercial banks, merchant banks, development banks, are one
of the banks instrument that hold a vital role in external trade and has been
branched all over Nigerian states. The contribution of the above banks to
international trade has been a satisfactory type. Most importers and exporters
dances to tune of these banks.
Why has these very banks so appetizing to the society and the
world at large? Is the success as a result of the banks efforts in it’s
operations?
Why do importers/exporters prefer it to other financing
institutions?
1.3 OBJECTIVES OF THE STUDY
1.
To find out if commercial banks play any role in
international trade in Nigeria.
2.
To find out if merchant banks play any role in
international trade in Nigeria.
3.
To find out if development banks play any role in
international trade in Nigeria.
4.
To find out if commercial banks play any role in
international trade.
5.
And equally to find out if people’s bank play any role
in international trade in Nigeria.
1.4 RESEARCH QUESTION
1.
What role do commercial banks play in international
trade?
2.
What role do merchant banks play in international
trade?
3.
What role do development banks play in international
trade?
4.
What role do community banks play in international
trade?
5.
What role do people’s bank play in international trade?
1.5 ASSUMPTION OF THE STUDY
It is assumed that in this research
the secondary data collected is correct and reliable.
The procedure and method used is
correct and reliable.
1.6 SCOPE OF STUDY
Area of coverage
The role of banks in international
trade in Nigeria .
Banks method of contribution to
international trade in Nigeria.
Why international trade in Nigeria?
Advantages of international trade in
Nigeria.
1.7 SIGNIFICANCE OF THE STUDY
Today, the government parastatals,
banking sectors and the society are all hands on deck to enhance the
international trade development and growth of Nigerians economy.
The research study will be of high
benefit to banking sectors, importers/exporters and to the society in general
to embark of the effectiveness of their business, which inturn will change of
the society. Also the study will determine the census and problems of banks
role in international trade in Nigeria and thereby should be taken as a
corrective measure.
Through this investigation, therefore, the banks and the
society will then know their weak points and willingly adopt measure aimed at
enhancing it’s business effectiveness.
The government will be in the position to adopt the right
strategies to enable the society achieve it’s business expectations or goals.
1.8 LIMITATION OF THE STUDY.
Limitation encountered by the research
work is finance and incorporation attitude of respondent: - Some respondents
were out rightly hostile and very impatience to entertain genuine requests.
There was also bureaucratic bottle – neck that some official documents.
However, these constraints did not destroy the ingredient of this research.
1.9 DEFINITION OF TERMS.
(a) International
Trade: As described by the Author,
Norbert M Ile in his published test “Economics of business studies” (1999, P.
278) defines an international trade or external trade as “a trade between two
or more countries; it is the exchange of goods and services between two or more
countries”.
(b) Banking Institution: We
can define a bank as any organization that handles people’s money. It is a
dealer in debts, but indebtedness has a correlation to wealth and hence, a bank
can be described as a liquefier of wealth.
(c) Role: It is defined as
“actors in a play; persons task or duty in undertaking.
(d) Foreign Exchange: This
is a process by which a country exchanges it’s goods/services to another
country’s goods/services.
(e) Overdraft: This is a
system whereby a customer drawns more money then he has to his credit in a
bank.
(f) Economy: It is a system
of control and management of the money goods and other resources of a society.
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