Experts in the Nation’s Capital Market have expressed optimism on the prospects of an economic recovery for Nigeria starting from the first quarter of 2021 if government aggressively pursues policies that reduce vulnerabilities of the economy to external shocks while at the same time boosting external reserves
Keynote speaker at the just concluded annual workshop of the Capital Market Correspondents Association (CAMCAN) workshop tagged: “The Capital Market in Post COVID-19 Nigerian Economy”, Professor Uche Uwaleke urged the Federal Government to partially privatize its assets such as the Nigerian National Petroleum Corporation through the Nigerian Stock Exchange (NSE).
He advised that the proceeds from the sales of such assets be deployed to recapitalize development financial institutions such as the Bank of Industry (BoI) and Bank of Agriculture (BoA).
Addressing the question of security in the country, Professor Uwaleke said tackling insecurity in the country will also go a long way improving the ease of doing business in the country.
‘’Police reforms following EndSARS protest will improve security.’’
Speaking on the outlook in the post-COVID-era, Uwaleke said Joe Biden’s victory in the US presidential election and COVID vaccine prospects have positive implications for global capital markets.
“In Nigeria, the containment of COVID-19 and the unlikely possibility of another lockdown will further boost the market. Exchange rate unification will likely improve foreign investments and foreign exchange market liquidity,” he said.
Uwaleke added that the ongoing Nigerian Stock Exchange demutualisation would also improve capital raising ability for infrastructure modernization.
On infrastructural development, Professor Uwaleke also called on the government to address infrastructure gaps through Public Private Participation, issue more infrastructure bonds such as Sukuk and Green Bonds which are tied to self-liquidating projects.
‘’The planned reopening of the borders will reduce inflation rate, while the planned introduction of financial derivatives in the capital market to mitigate volatility,” he said.
Uwaleke also called for the strict enforcement of the corporate governance codes for listed companies to boost investor confidence, leverage RegTech and Research to proactively stay ahead of the market, leverage FinTech to innovate and improve service delivery, upskill market intermediaries/Capital market operators, expand product offerings to increase captive market and continuously engender the market confidence through zero tolerance for infractions.
Corroborating his presentation, the President, Institute of Capital Market Registrars (ICMR), Mr Seyi Owoturo, advised the Federal Government to chart new ways of moderating or balancing the effect of inflation on real returns of investments in the capital market.
Also speaking, the Vice President, Market Architecture, FMDQ Securities Exchange, Ms Jumoke Olaniyan, noted thatt government needs to do all it can to ensure the recovery of the economy by first quarter (Q1) of 2021 is feasible.
“What we have seen in recent times is that we have seen that the Nigerian economy can be very resilient and which is very critical or the foundation of any capital market.
“It is a situation whereby a capital market can be created to absorb the shock that it goes through and always recover quickly.
“Therefore, it is very good that there are indicators that we will recover in the first quarter of 2021 and that is testament to the resilience of the economy itself.
“This means we have a very strong foundation but we really need to put building blocks to make sure that we achieve that quick recovery and maintain that quick recovery in all facets of the economy”, Olaniyan said.