The Securities and Exchange Commission (SEC) has partnered with capital market stakeholders to urge the Nigerian government to accelerate market growth by introducing pro-capital market measures into the national budget.
This was part of the resolutions discussed at the third Annual Budget Seminar of the Securities and Exchange Commission (SEC), which had the theme, “Budgets, Elections and Capital Markets: Risks and Opportunities in 2019″.
At the event, a professor of Capital Market and Head, Banking and Finance Department, Nasarawa State University, Keffi, Uche Uwaleke, noted that five emerging countries that have adopted such measures as part of their budget have recorded increased level of economic growth.
According to Uwaleke, “some emerging African countries have recognised that it is important to include pro-capital market measures in the budget like reducing listed companies’ income tax and clauses that allow privatisation through the capital market. Pakistan for instance, is looking at reducing company income tax for listed companies, while India on the other hand, plans to privatise through the stock exchange”.
The Professor also noted that government as a necessity must encourage the consumption of local products to encourage the growth of listed companies on the equity market, and enable them compete favourably in the global economy and deepen the market.
Speaking at the event, the Acting Director General of the Securities and Exchange Commission, SEC, Ms. Mary Uduk said the local and foreign investors are interested in the nation’s budget and the level of implementation, but the capital market is looking at the impact of the budget, and how the market can aid its implementation.
Uduk said “the capital market is very important in accessing long term funds for capital projects. The capital market can fund budget deficit. We are interested in driving and contributing to this economy. We believe there are a lot of opportunities for the capital market in the budget”.
The Head Economic Research of SEC, Dr. Afolabi Olowookere, said opportunities abound for equity and sub-national issuances as a means to fund the budget. He stressed the need for state governments to also explore the capital market for funding, even as the federal government continues to reduce domestic borrowing to create more opportunities for private issuances.