July 20, 2021 / 11:31 AM / Ottoabasi Abasiekong for WebTV / Header Image Credit: YouTube
Using the capital market to support Nigeria's economic growth and development is gaining public sector appeal with recent steps taken by the Federal Government to collaborate with the Nigerian Exchange Group (NGX). Professor Uche Uwaleke the President of the Association of the Capital Market Academics in Nigeria (ACMAN) described it as a welcome development for capital market operators.
Speaking on the recent passage of the Petroleum Industry Bill (PIB) by the national assembly (NASS), Professor Uwaleke said it had the potential of unlocking growth in the local Oil and Gas sector.
He believed that the provision for the creation of the Nigeria National Petroleum Corporation Limited (NNPC Limited) was a step in the right direction but was limited due to its emphasis on commercialization.
Uwaleke advocated for a privatization process for the NNPC through the Securities and Exchange Commission (SEC), that would provide the opportunity for divestment of government shares through the capital market.
He called for the inclusion of the initial provisions in the defunct Petroleum Industry Governance Bill (PIGB) which spelled out the process for the divestment of the NNPC in 5 to 10 years.
The Professor of capital market studies cited the example of state-oil companies like Equinor(Norway), ENI(Italy), and Saudi Aramco (Saudi Arabia), that divested their shares through the capital market and are ranked among the most profitable oil and gas companies in the world.
He noted that the privatization of the NNPC would improve corporate governance and open up the capital market to new opportunities in the industry.
On the handshake between the NGX, the Nigerian Investment Promotion Commission (NIPC), and the Bureau of Public Enterprises (BPE) he described it as a collaboration that would strengthen public-private partnerships (PPPs) in the country.
Elaborating, he said the current administration has shown commitment in driving the PPP model to finance road infrastructure, through the tax credit incentive that a few private sector players have taken advantage of across the country.
Following reports from the BPE on the proposed privatization of the National Integrated Power Plants (NIPP), he called for a transparent process that would encourage investors.
On the global partnership between the FMDQ Private markets and the Oxford Foundry, University of Oxford, United Kingdom he said the collaboration would provide Nigerian entrepreneurs access to networks, finance, and skills that would make them globally competitive.
Reviewing the recent SEC-sponsored webinar on "Financing Solid Minerals through the Capital Market", he observed that it was important for the sector to have an enabling policy environment and effective regulations that could attract investments into the sector.