Adedapo Adesanya
By Adedapo Adesanya
The Securities and Exchange Commission (SEC) has expressed worry over negative impact the recent decline in prices crude oil and the coronavirus (COVID-19) on the Nigerian capital market.
Acting Director-General of the commission, Ms Mary Uduk, while speaking at a news conference in Abuja on Wednesday, stated that the capital market is a global phenomenon. So, whatever affects any other country of the world will affect the Nigerian capital market because oil, a global entity drives major economies.
“This thing is everywhere and our capital market is global just like any other capital market.
“You will recall that the other day in New York, they had to shorten the period of trading because of the amount of losses.
“Whatever it is that will affect any other country of the world right now will affect the Nigerian Capital market.
“The oil, the coronavirus – it is one global entity; it is a global thing, so, it will affect all the markets,” she said.
The acting director-general expressed dissatisfaction that the country’s 2020 N10.59 trillion budget has been threatened by the fall in the price, adding that efforts were being taken to tackle the issue.
“In Central Bank of Nigeria (CBN) now, the government has convened a conference that is looking at how these things are affecting the economy of Nigeria and you know that the budget 2020 is already seriously threatened because the benchmark was at N57 but now, oil price has gone down.
“It is a serious thing, so, all of us need to sit down and see what can we do. It is not just one sector, it has to be concerted efforts by all.
“Right now, as we speak, it is being done in CBN,” she explained.
Since the coronavirus outbreak began in China and spread to over 80 countries, global trade has slowed as there have been drops in demand leading to factory closures, decline in travel, consumption, shipping, manufacturing and public gatherings.
Also, prices of oil went down drastically following indecision by major oil producers to help keep supply regulated and prices stable.
Not seeing confidence in making profit, investors seeking to avoid long term damage take the easy route and sell their stocks. These have been evident in the last two days on the Nigerian Stock Exchange which have closed in the negatives.
