Monday, November 19, 2019 / 6:07 PM / Nifemi Taiyese for Proshare WebTV / Header Image Credit: WebTV
At the concluded 2019 Nigerian capital market conference hosted by the FMDQ securities exchange, key players in the financial market discussed Nigeria as a compelling destination for investment capital.
Moderated by the publisher of Businessday, Mr. Frank Aigbogun, it was an opportunity for the panelists to discuss the state of infrastructure, economic reforms and the confidence in speedy dispute resolution in the country.
Giving the opening statement, Mr. Oladele Afolabi Director of Portfolio Management Department at Debt Management Office, believed if Nigeria develops the right kind of infrastructure, increased economic opportunities could emerge.
Speaking further on opportunities that should attract foreign investors to Nigeria, he identified Agriculture and Solid Minerals as areas that need to developed through key investments.
He agreed that the right structures need to be put in place to attract investments.
"People need to feel safe about bringing their money to the opportunities in Nigeria's huge market" Mr Oladele said.
Dr. Afolabi Olowookere Director, Research, at the Securities and Exchange Commission, SEC, stressed the need for Nigeria to make itself a compelling case and understand that it is competing with others in the attraction of capital.
He noted that the nation has to work out ways of retaining capital, mobilizing it and effectively deploying it.
Speaking from a regulatory perspective, he said "We recognize that the capital market is very central to attracting capital, pricing it and seeing to its effective deployment. There is need for both direct and foreign portfolio investment".
Speaking further, he said "We need to as much as possible to set out a regulatory environment that investors can have confidence in; for instance, some of SEC's rules allow for cross-listing, and companies can easily list on the platforms".
Beyond federal government and corporates, Olowookere called on sub-nationals to explore the issuance of infrastructure revenue bonds.
According to him, "There should be a situation where investors can partner with state governments to finance or float special purpose vehicles,SPV, issue bonds targeted at projects and then they can settle the obligation on those projects with the cash flows from the projects."
According to Mr. Emmanuel Ukeje, the Special Adviser to the Central Bank of Nigeria Governor on Financial Markets, the size of Nigeria in terms of population is a market itself.
He believed that in terms of returns on investments, Nigeria is still one of the most profitable places to invest. Ukeje said the yields on domestic securities are very attractive in Nigeria, so investors could be sure of good returns.
Ukeje, however, highlighted the fact that one of the things investors are scared of is the risk of currency fluctuation and issues like infrastructural deficiency in the country.
The CBN official believed that Nigeria has enormous potential for economic growth, which could be jumpstarted through capital investments into the economy.
He said the CBN would support the growth of the Micro, Small and Medium Enterprises, MSMEs and also ensure that the monetary policy environment provides enablers for them to access capital.