Economy
Infrastructure Development Key to Growth—SEC
Infrastructure development has been described as critical for the achievement of economy prosperity, sustainable growth and development of Nigeria.
Therefore, the need to attract private and domestic capital to fund and support critical infrastructure is paramount.
This, among others, were the resolutions reached at the end of the Securities and Exchange Commission (SEC) yearly budget seminar.
The seminar, which held in Lagos Thursday, had as its theme Leveraging the 2020 Budget and Finance Act for the Growth of the Nigerian Capital Market.
Participants also recommended the provision of conducive business environment and credit enhancements for the Small and Medium Scale Enterprises (SMEs) to thrive, because the SME sub-sector is one of the critical pillars for economic growth and national prosperity.
According to the communique at the end of the seminar, “There is need to create more hedging opportunities in the Nigerian capital market, as this have implication for market liquidity and efficiency.
“The government needs to work towards encouraging the participation of the private sector in the Nigerian business environment. The power and agricultural sectors are key sectors where in-depth reform and partnership with the private sector are important. There should be partnership with the private sector to mobilize domestic resources, create quality jobs and lift people out of poverty.”
Participants also agreed on the need to leverage technology for trade and focus on adding value to the agricultural sector which is currently very low-paying.
This sector, they posited, needs to become more beneficial to those involved and can be done through means such as provision of power for crop preservation, thus eliminating post-harvest losses.
In her opening address, Acting Director General of SEC, Ms Mary Uduk, emphasised the important role that budgets play in an economy, and by extension in the capital market.
This importance, Ms Uduk said, is actually the basis on the seminar is organised to analyse the risks and opportunities presented by the government budget.
She said over the years, the SEC Budget Seminar Series has served as a forum for evaluating the connection between the Nigerian capital market and the annual Federal Government budget, with the aim of identifying how the capital market can contribute to, and benefit from, the budget and its implementation.
“In the course of the seminar, we shall look at the performance of the 2019 budget, the performance of the capital market, the proposed 2020 budget as well as its likely impact on the capital market.
“Also critical are the aspects of the new Finance Act that affect the capital market. These include the provisions on Securities Lending, Real Estate Investment Schemes, minimum tax, increased Value Added Tax, amongst others.
In his remarks, former Chairman of SEC, Mr Suleyman Ndanusa, and Chairman of the occasion, said the annual budget cycle was important particularly in countries like Nigeria where government expenditure has significant impact on the economy.
Mr Ndanusa said the budget sets the tone for the direction of the economy each year which presents opportunities and risks.
According to him, “I personally love the choice of this topic, given the pressing need to grow our capital market and the important role played in our economy by the government through its fiscal and other policies.
“Looking at some broad items of the 2020 budget; the total expenditure amounts to N10.6 trillion, which is a 19 percent increase on that of 2019, but just about 6.5 percent of the nation’s GDP. The budget is split into 79 percent for recurrent expenditure and 21 percent for capital expenditure with a deficit of around N2 trillion.
“How this deficit would be funded is always of interest to the capital market community. Coupled with the implications of the choice of funding. There are the usual questions on whether we are returning to a period of high treasury yields and the consequent crowding out of corporates from the debt markets as well as the trade off between investments in fixed income and equities segments of the capital market” he added.
Recall that President Muhammadu Buhari presented the 2020 budget to the National Assembly on October 8, 2019 which was eventually signed at a record time on December 17, 2019, with an approved budget of N10.6 trillion.
By Adedapo Adesanya
The National Pension Commission (PenCom) has defended its decision to allow Pension Fund Administrators (PFAs) to invest in the parent companies of their custodians, insisting that adequate safeguards are in place to protect contributors’ funds.
The director-general of the pension regulator, Ms Omolola Oloworaran, speaking on Tuesday during the Meet the Press Briefing at the Presidential Villa, Abuja, said the commission’s decision to relax the investment restriction followed a comprehensive risk assessment that found minimal conflict of interest.
She explained that under PenCom’s investment regulations, PFAs are only permitted to invest pension assets in carefully selected instruments that meet stringent criteria, including profitability, strong credit ratings and proven track records.
According to her, the commission regularly reviews its investment regulations, conducts routine examinations and spot checks on PFAs to ensure strict compliance with established risk management guidelines.
“PFAs cannot just go into the stock market and buy any kind of stock. There are strict guidelines. Companies must demonstrate profitability, have a proven track record and satisfy other criteria before pension funds can invest,” she said.
Ms Oloworaran noted that each PFA also operates under the oversight of a board, an investment committee and a risk management committee, providing additional layers of governance to safeguard contributors’ funds.
She said PenCom recently issued a circular allowing PFAs to invest in the parent companies of their custodians after determining that the potential conflict of interest was negligible.
The PenCom boss explained that the parent companies involved are largely Tier-1 banks, including First Bank, United Bank for Africa (UBA) and Zenith Bank, which she described as A-rated institutions with strong financial foundations.
She said the policy was intended to widen investment opportunities for pension funds without compromising safety.
Using Stanbic IBTC as an example, Ms Oloworaran explained that if its custodian is Zenith Bank, the previous restriction prevented the pension administrator from investing in Zenith Bank shares despite the bank’s strong performance.
“We reviewed the risks and any potential conflict of interest and found the risks to be very low. That is why we opened that investment window,” she said.
By Aduragbemi Omiyale
Analysts at Meristem Research have predicted that the inflation rate for June 2026 in Nigeria should marginally rise to 15.95 per cent on a year-on-year basis from the 15.93 per cent reported in May 2026.
The National Bureau of Statistics (NBS) is expected to release inflation numbers for last month later today, Wednesday, July 15, 2026.
In its report sighted by Business Post, Meristem Research said it expects inflationary pressures to re-emerge across key economies in the near term, as the re-escalation of the US-Iran conflict has reignited upward pressure on global oil prices.
It disclosed that this marks a sharp reversal from most of June, when the ceasefire between the two countries helped drive oil prices lower, raising expectations of some relief on the inflation front.
With conflicts now flaring up again, oil prices are likely to increase again, and the anticipated easing in energy-driven inflation may not materialise as broadly as earlier envisaged.
“Nonetheless, some relief is likely from the food segment, where robust supply conditions across major producing regions and softening demand should continue to ease food price pressures,” it stated.
The team also explained that it projected a 15.95 per cent inflation rate because of the lingering effects of persistent food price pressures.
“However, we expect core inflation to moderate as the sharp reversal in energy prices begins to filter through to transportation, distribution, and other energy-related costs, easing underlying price pressures.
“On a month-on-month basis, the combined effect of lower petrol prices, a relatively stable Naira, and the gradual pass-through of reduced energy costs across the supply chain should exert further downward pressure on inflation.
“Based on our assessment, food inflation is expected to remain the key swing factor, as seasonal pre-harvest supply constraints are likely to offset some of the gains from lower logistics costs,” it said.
By Adedapo Adesanya
The duo of Central Securities Clearing System (CSCS) Plc and Afriland Properties Plc weakened the NASD Over-the-Counter (OTC) Securities Exchange by 1.61 per cent on Tuesday, July 14.
CSCS Plc saw its stock value drop N9.08 to close at N82.40 per share compared with the preceding session’s N91.48 per share, and Afriland Properties Plc slid by 17 Kobo to sell at N15.00 per unit versus N15.70 per unit.
The losses recorded by the two securities pulled back the market capitalisation by N41.64 billion to N2.546 trillion from N2.587 trillion, and cracked the NASD Security Index (NSI) by 69.36 points to 4,242.31 points from 4,311.67 points.
It was observed that the exchange witnessed two price advancers during the session, led by FrieslandCampina Wamco Nigeria Plc, which gained N1.37 to end at N151.37 per share compared with the previous day’s N150.00 per share, and Food Concepts Plc chalked up 5 Kobo to settle at N2.50 per unit versus N2.45 per unit.
The volume of securities traded by market participants surged by 50.7 per cent to 13.7 million units from the previous 9.1 million units, while the value of securities went down by 79.7 per cent to N65.2 million from N320.4 million, and the number of deals crashed by 3.6 per cent to 27 deals from the previous session’s 28 deals.
At the close of transactions, Great Nigeria Insurance (GNI) Plc remained the most traded stock by value on a year-to-date basis, with the sale of 3.4 billion units for N8.4 billion, trailed by Infrastructure Credit Guarantee (Infracredit) Plc, which exchanged 2.3 billion units valued at N6.5 billion, and CSCS Plc with 73.9 million units transacted for N5.2 billion.
GNI Plc also closed the trading day as the most traded stock by volume on a year-to-date basis, with 3.4 billion units worth N8.4 billion, followed by Infracredit Plc with 2.3 billion units traded for N6.5 billion, and Resourcery Plc with 1.1 billion units valued at N415.7 million.
