Nigeria can tap equipment leasing to stimulate growth – ELAN

Africa’s most populous nation can tap the opportunities in equipment leasing to stimulate economic growth and development, according to a new report by The Equipment Leasing Association of Nigeria (ELAN).

The Equipment Leasing Association of Nigeria (ELAN) says that the country can utilise equipment leasing as a key tool to facilitate economic growth.

The association disclosed this in its 2025 outlook titled, ‘Sustainability Resilience Amidst Continued Challenges’ made available to BusinessDay.

“Equipment leasing is indeed the creative financing alternative utilised globally to stimulate economic development attributes of enhancing capital formation in the economy that drives job creation, revenue, better life and economic growth,” the statement said.

The association explains that leasing supports the above statement by allowing easy access to much-needed productive assets.

Since its inception, leasing has been supporting economic development, and today, it is a major player in all sectors of the economy, enhancing capital formation and generating employment.

“2025 is expected to witness the consolidation of the policy reforms and stability of the economy, devoid of the major shock or distortion witnessed in the last 18 months occasioned by the removal of subsidies and the floating of the naira,” it added.

In the last few years, the industry has sustained its growth trajectory, regardless of the headwinds in the economy.

“Outstanding leases stood at N4.19 trillion in 2023 as against N3.25 trillion in 2022, representing a 28.7 percent increase, while new leases piqued at N935.6 billion against N672 billion in 2022, recording a remarkable 39.2 percent growth,” ELAN noted.

Also, leasing can facilitate the actualisation of key project initiatives of the federal government, including access to credit intervention programmes.

The association further revealed its intention to remain resilient in the face of economic challenges while making significant contributions to capital formation in the economy.

“As the tough microeconomic environment takes its toll on the leasing industry, the industry will continue to thrive by sustaining its resilience amid the challenges,” the statement read.

It called on all stakeholders to “join hands to sustain the development and growth of the economy.”

In 2023, the agricultural sector accrued N300.8 million through leasing, manufacturing N607.7 million, while the transport & logistics sector accrued N977.1 million in the same year, establishing the economic importance of leasing.

The association however stated that it was significantly impacted by the tough macroeconomic conditions last year, which became more weighed by the policy reforms of the federal government.