More Work Required to Achieve Double-digit Growth, Says FG

Ndubuisi Francis in Abuja

The federal government has declared that a lot of work is required to build the Nigerian economy to a level to enable it achieve double-digit growth.
Nigeria posted a 0.51 per cent growth in gross domestic product (GDP) in the first quarter of 2021, after a 0.11 per cent growth in the fourth quarter of 2020.

No nation, the federal government stated, attains an optimum infrastructural development without the efficient use of the capital market.
Speaking in Abuja yesterday, at a national workshop organised by the Chartered Institute of Stockbrokers (CIS), the Minister of Finance, Budget and National Planning, Mrs. Zainab Ahmed noted that a cardinal focus of the ‘next level’ agenda of the current administration was to address infrastructural deficiencies/gaps and improve the living standard of the average Nigerian.

She stated that the theme of the workshop, “Leveraging the Financial Markets to Achieve Double-digit Economic Growth for Nigeria,” was apt and pivotal to the economic agenda of the current administration.

According to her, the Nigerian capital market has over the years provided access to significant long-term development capital to the federal government, other tiers of government and the private sector.

She recalled that in an attempt to achieve consistent economic growth, earlier in the life of the administration, the government had developed the Economic Recovery and Growth Plan (ERGP) 2017 – 2020.

The ERGP, she explained, was a medium term plan designed to foster growth and build a globally-competitive economy through the diversification of the economy, increased investment in infrastructure, digitalisation of the economy, and improvement in the ease of doing business in the country.

Ahmed observed that year 2020 was like no other, as a result of the impact of COVID-19 worldwide, adding that a three-year continuous run of positive growth in GDP was truncated in the second quarter of that year by the harsh economic impact of the pandemic.

Explaining the pivotal role of the capital market, she said: “Our 2020 “Budget of Sustaining Growth and Job Creation” had to be amended in response to the fiscal pressures arising from the pandemic.

“We will recall that in 2020, the Federal Government of Nigeria, through the Debt Management Office (DMO) raised N669.12 billion from the capital market, through its third Sukuk bond offering, with the proceeds used to construct and rehabilitate as many as 44 major roads across the country.

“Also worthy of note is the Offer for Subscription of the Federal Government of Nigeria Savings Bond (FGNSB) by DMO and executed by Stockbrokers. In addition, the Federal Government of Nigeria accessed the International Capital Market (ICM) with Eurobond issuance to finance capital budget deficits.”

The minister stated that as various budgetary allocations and policy pronouncements would attest to, the Buhari administration had demonstrated unprecedented commitment towards bridging the country’s massive infrastructure deficit.

“Just a few months ago, government approved the establishment of the Infrastructure Company (Infraco), which is envisaged to become a world-class infrastructure development vehicle for Nigeria.

“The company will serve as the platform for seamless public-private partnership in infrastructural financing in the country, effectively interfacing with institutions such as the Central Bank of Nigeria, the Nigeria Sovereign Investment Authority, pension funds and other financiers home and abroad.”
The minister therefore, pointed out that the pivotal role of CIS in capital formation in Nigeria cannot be over-emphasised.

She added that it plays a vital role in the development of the capital market, being the professional institute established by Act 105 of 1992 to provide certification for professionals in stockbroking, securities and investment, fund and portfolio management, asset management, investment management, and other related fields. It is responsible for the regulation, training and disciplining of members of the profession in Nigeria.

Ahmed noted that over the years, her ministry has been working closely with the Chartered Institute of Stockbrokers, adding that the ministry is statutorily represented on the Governing Council of the Institute.

She admonished the CIS to keep the flag flying, uphold the ethics of the profession and work assiduously to sustain investors’ confidence in order to bring back the good old days in the Nigerian capital market so as to attract the full participation of government at all levels.