Expert Highlights Opportunities in Real Sector Investment

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Goddy Egene
The Managing Director/Chief Executive Officer of Skystone Capital and Investment Limited, Mr. Ola Olabinjo, has called on Nigerians to take advantage of the opportunity created by the relatively low yields on traditional fixed income securities and re-direct their capital into the real sector to stimulate job creation, drive double-digit investment returns and galvanise economic activities.

Olabinjo stated this at the maiden webinar organised by the Swiss-based Faithshield Investment Management Limited titled: “Foreign Exchange, Interest Rate and Inflation: How they affect wealth creation.”

According to him, investment in the real sector is a critical factor that would drive the revolution needed to resuscitate the Nigerian economy which has been badly hit by the twin issue of foreign exchange volatility caused majorly by the breakdown amongst members of the Organisation of Petroleum Exporting Countries (OPEC) and the unexpected outbreak of the Coronavirus Disease (COVID – 19).

He explained that while domestic money managers that invested in government securities may not be excited by the negative adjusted real returns currently being experienced, asset managers in developed countries are beginning to channel investible capital to address the world’s most pressing challenges in critical sectors such as agriculture, renewable energy, transport infrastructure and affordable basic services including housing, healthcare, and education.

He therefore, he maintained that Nigeria must follow suit to make appreciable progress in its quest to lift million out of the poverty bracket.

Speaking alongside, Mr. Nwabueze Amiaka, Managing Director, Faithshield Investment Management Limited, Olabinjo noted efforts of the Central Bank of Nigeria (CBN) geared towards stimulating credit to the private sector and its recently approved N15 trillion Infrastructure Development Company Plc (InfraCo) expected to be co-owned with the Nigeria Sovereign Investment Authority (NSIA) and Africa Finance Corporation (AFC) as a good step in the right direction.

Speaking on inflation, he said Nigerians should expect to witness a taper down of inflationary pressure as the gains of federal government’s investments in rail and road networks across the country begins to kick in.
Olabinjo explained that the high headline inflation anchored on the continued acceleration of food inflation which rose by 30 basis points (bps) to 15.48 per cent as at July 2020, is a result of the huge infrastructure deficit around transport, processing, warehousing, required to move agriculture produce from farm to markets.