Economy
SEC Vows to Make Islamic Capital Market Attractive in Nigeria
By Dipo Olowookere
Those who wish to explore the Islamic capital market in Nigeria have been assured of an attractive enabling environment by the Securities and Exchange Commission (SEC).
According to the Director-General of SEC, Mr Lamido Yuguda, efforts are being made to work with relevant stakeholders to implement recommendations for the non-interest capital market sector in line with the objectives of the 10-year Nigerian Capital Market Master plan (2015-2025), which include developing the segment of the market to contribute at least 25 per cent of the overall capital market capitalisation by 2025, with Sukuk contributing 15 per cent of outstanding bond issuances.
Mr Yuguda, who spoke at the 2021 African International Conference on Islamic Finance held in Abuja on Wednesday, stated that Islamic finance instruments are globally recognized as acceptable securities, with less Value-at-Risk due to their asset-based and project-tied investment features.
He noted that due to this, the sector offers financial products that are safe, competitive and attractive, adding that many jurisdictions have realised the potentials in Islamic finance and have positioned themselves to tap the potential benefit of such financing.
“It is noteworthy that since Islamic finance heavily relies on the Islamic capital market (ICM) as an investable outlet, products such as Sukuk (Islamic bond), Islamic REITs (I-REITS), Islamic Funds (I-Funds) and Exchange-mirrored Traded Funds (Islamic Equity Index) could all be offered for the purpose of financing infrastructure,” the SEC chief, who was represented by the Executive Commissioner Corporate Services SEC, Mr Ibrahim Boyi, submitted.
At the event themed Infrastructure Financing, Sustainability, and the Future of African Markets 2.0, he further stated that, “Sukuk issuances are increasingly gaining significance as a veritable mode of infrastructure financing.
“Consequently, a number of countries in the Sub-Saharan region of the continent; Sudan, Gambia, Senegal, South Africa, Ivory Coast, Nigeria, Mali, and Togo, have issued sovereign Sukuks to finance infrastructure.”
“For example, we have reviewed existing regulatory frameworks and introduced new ones. In particular, we issued rules on Islamic Fund Management as well as on Sukuk issuance.
“These two legal frameworks have encouraged Islamic product innovation with the registration of ten ethical/shariah compliant funds and the issuance of Nigeria’s sub-national Ijara Sukuk by the Osun State government in 2013, which was oversubscribed.
“Also, the federal government, through the Debt Management Office (DMO) has so far issued Ijara Sukuk in excess of N350 billion within the last 3 years. The funds were used to construct and rehabilitate infrastructure development projects across the six geo-political zones of the country.”
He noted that the agency recently approved a N30 billion corporate Sukuk programme and a N10 billion series issuance under the programme. This marks the first corporate Sukuk issuance to the public; commendably, the proceeds are to be used to finance housing infrastructure.
Similar to the sovereign issuances, the corporate issuance was also oversubscribed. The issuance was a landmark in the Market and we are confident that more corporates will begin to access the market.
According to him, the theme of this year’s conference resonates with a core function of the capital market as the market plays a crucial role in enabling access to medium and long term financing which is better suited to infrastructural development.
“According to the AfDB, Africa requires an annual investment of between $130 and $170 billion annually in infrastructure to reduce its infrastructure deficit. While according to the Global Infrastructure Hub (2020), Africa required an infrastructure investment of $184.03 billion in 2019 and $190.1 billion in 2020 to close its infrastructure deficits.
“The African continent continues to be challenged by deficits in infrastructure with governments being the major financier of infrastructure. Regrettably, governments’ efforts to finance the sector is constrained by large deficits in the budget, rising public debt and debt sustainability concerns,” he said.
He disclosed that the commission was also considering modalities to constitute a Sharia Advisory Council as a body of experts to advise the SEC and the market on non-interest products and their applications.
“Going forward, our focus will be on public enlightenment to encourage sub-national and corporate issuances and stronger capacity building initiatives. This is what informed the idea of hosting 3 webinars on non-interest capital market products in 2021 and more will be organised next year.
“We hope that the State governments represented here will take advantage of this important opportunity to familiarize themselves with the kind of products that can be issued and how to leverage this exciting area of finance to better the lives of our citizens.”
He reiterated the SEC’s commitment to continue to identify ways of using Non-Interest capital market products such as Sukuk as a tool for financing infrastructural development.
“We are committed to facilitating the growth of the non-interest capital market segment through innovation whilst ensuring a fair, efficient and transparent market.
“We will continue to put in place clear and consistently applied regulatory frameworks and reduce regulatory and operational impediments to engender the smooth functioning of the market,” he added.
By Adedapo Adesanya
The Nigeria Customs Service (NCS) Oil and Gas Free Trade Zone Command in Rivers State says it has achieved a record-breaking revenue collection of N53.98 billion between January and November 2024, exceeding its annual target by 2.3 per cent and nearly doubling the N26.80 billion generated in 2023.
This was disclosed by the Customs Area Controller, Oil and Gas Free Trade Zone, Onne, Comptroller Seriki Usman, during a press briefing at the command’s headquarters, where he attributed the success to strategic collaboration with stakeholders, operational efficiency, and a focus on regulatory compliance.
He said, “A notable achievement of the command was its record-breaking revenue collection of N53.98 billion. This figure represents a 2.3 per cent increase over our annual target for 2024 and a remarkable 98.6% rise compared to the N26.80 billion collected in 2023.
“Our record-breaking revenue underscores the importance of effective trade facilitation and regulatory compliance. This achievement reflects the commitment of our officers, the collaboration with stakeholders, and the critical role of the Oil and Gas Free Trade Zone in driving Nigeria’s economic growth,” he said.
He explained that the Command successfully facilitated the export of key products such as refined sugar, fertiliser, liquefied natural gas, LNG, and crude oil from major facilities, including Bundu Sugar Refinery, Notore Chemical PLC, and Bonny Island.
“The seamless management of imports and exports within the free trade zone has enhanced operations for licensed enterprises,” he noted.
Speaking on the significance of these achievements, Comptroller Usman emphasized the need to maintain the momentum.
“This accomplishment is not just about numbers but about fostering trade growth, innovation, and creating a conducive environment for businesses to thrive within the free trade zone.”
On regulatory compliance, Comptroller Usman reassured Nigerians of the Command’s commitment to ensuring adherence to international trade regulations while fostering economic progress.
“Our focus remains on enhancing service delivery, promoting ease of doing business, and driving revenue generation that supports the nation’s development goals,” he said.
The command emphasized that collaboration with stakeholders, particularly the Oil and Gas Free Trade Zone Authority, has been pivotal in achieving these milestones, and called for continued partnership to sustain trade growth and improve service delivery.
As the year comes to a close, the command has reiterated its resolve to solidify its role as a critical revenue driver and trade facilitator in Nigeria’s oil and gas sector.
Mr Usman said the performance reflects the command’s vital role in strengthening Nigeria’s non-oil revenue base and its determination to remain a key player in the country’s economic transformation efforts.
“We remain committed to sustaining our achievements, fostering trust among stakeholders, and contributing significantly to the nation’s economic growth,” Comptroller Usman concluded.
By Modupe Gbadeyanka
The federal government, the 36 states of the federation and the 774 local government areas have received N1.727 trillion from the Federal Accounts Allocation Committee (FAAC) for December 2024.
The funds were disbursed to the three tiers of government from the revenue generated by the nation in November 2024.
At the December meeting of FAAC held in Abuja, it was stated that the amount distributed comprised distributable statutory revenue of N455.354 billion, distributable Value Added Tax (VAT) revenue of N585.700 billion, Electronic Money Transfer Levy (EMTL) revenue of N15.046 billion and Exchange Difference revenue of N671.392 billion.
According to a statement signed on Friday by the Director of Press and Public Relations for FAAC, Mr Bawa Mokwa, the money generated last month was about N3.143 trillion, with N103.307 billion used for cost of collection and N1.312 trillion for transfers, interventions and refunds.
It was disclosed that gross statutory revenue of N1.827 trillion was received compared with the N1.336 trillion recorded a month earlier.
The statement said gross revenue of N628.972 billion was available from VAT versus N668.291 billion in the preceding month.
The organisation stated that last month, oil and gas royalty and CET levies recorded significant increases, while excise duty, VAT, import duty, Petroleum Profit Tax (PPT), Companies Income Tax (CIT) and EMTL decreased considerably.
As for the sharing, FAAC disclosed that from the N1.727 trillion, the central government got N581.856 billion, the states received N549.792 billion, the councils took N402.553 billion, while the benefiting states got N193.291 billion as 13 per cent derivation revenue.
From the N585.700 billion VAT earnings, the national government got N87.855 billion, the states received N292.850 billion and the local councils were given N204.995 billion.
Also, from the N455.354 billion distributable statutory revenue, the federal government was given N175.690 billion, the states got N89.113 billion, the local governments had N68.702 billion, and the benefiting states received N121.849 billion as 13 per cent derivation revenue.
In addition, from the N15.046 billion EMTL revenue, FAAC shared N2.257 billion to the federal government, disbursed N7.523 billion to the states and transferred N5.266 billion to the local councils.
Further, from the N671.392 billion Exchange Difference earnings, it gave central government N316.054 billion, the states N160.306 billion, the local government areas N123.590 billion, and the oil-producing states N71.442 billion as 13 per cent derivation revenue.
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange recorded a 0.65 per cent gain on Friday, December 13, boosted by three equities admitted on the trading platform.
On the last trading session of the week, Okitipupa Plc appreciated by N2.70 to settle at N29.74 per share versus Thursday’s closing price of N27.04 per share, FrieslandCampina Wamco Nigeria Plc added N2.49 to end the session at N42.85 per unit compared with the previous day’s N40.36 per unit, and Afriland Properties Plc gained 50 Kobo to close at N16.30 per share, in contrast to the preceding session’s N15.80 per share.
Consequently, the market capitalisation added N6.89 billion to settle at N1.062 trillion compared with the preceding day’s N1.055 trillion and the NASD Unlisted Security Index (NSI) gained 19.66 points to wrap the session at 3,032.16 points compared with 3,012.50 points recorded in the previous session.
Yesterday, the volume of securities traded by investors increased by 171.6 per cent to 1.2 million units from the 447,905 units recorded a day earlier, but the value of shares traded by the market participants declined by 19.3 per cent to N2.4 million from the N3.02 million achieved a day earlier, and the number of deals went down by 14.3 per cent to 18 deals from 21 deals.
At the close of business, Geo-Fluids Plc was the most active stock by volume on a year-to-date basis with a turnover of 1.7 billion units worth N3.9 billion, followed by Okitipupa Plc with the sale of 752.2 million units valued at N7.8 billion, and Afriland Properties Plc with 297.3 million units sold for N5.3 million.
In the same vein, Aradel Holdings Plc remained the most active stock by value on a year-to-date basis with the sale of 108.7 million units for N89.2 billion, trailed by Okitipupa Plc with 752.2 million units valued at N7.8 billion, and Afriland Properties Plc with a turnover of 297.3 million units worth N5.3 billion.
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