Connect with us


Nigeria Needs Double-Digit Growth to Reduce Poverty—Yuguda



Double-Digit Growth

By Aduragbemi Omiyale

If Nigeria intends to reduce poverty and provide for the welfare of its citizens, then it must ensure that the economy records a double-digit growth rate.

This was the submission of the Director-General of the Securities and Exchange Commission (SEC), Mr Lamido Yuguda, at the annual workshop of the Chartered Institute of Stockbrokers (CIS) with the theme Leveraging the Financial markets to achieve double-digit economic growth for Nigeria held in Abuja last Thursday.

While delivering his paper at the event which attracted various stakeholders, Mr Yuguda noted that growing the nation’s gross domestic product (GDP) by 10 per cent and above should not be a herculean task given that most key factors of production like a large vibrant youthful population, arable land, abundant rainfall, good drainage and a large and growing pool of savings are available.

He stressed that one key factor dragging the country backwards was infrastructure, noting that solving this problem will accelerate domestic production and employment given the direct correlation between an increase in production and job creation.

“Infrastructure is the area where we have a major problem and I mean roads and rail transportation, power generation and distribution, health infrastructure, and the like.

“I believe the capital market can play a vital role in the financing of infrastructure and forums such as this one would do well to dwell on this important subject.

“Recall that at independence in 1960, the domestic savings pool was rather limited, yet the new nation was able to mobilise adequate funds from both domestic and foreign sources to fund the construction of highways, railways and large power projects.

“These same projects are in a dismal state today when the population has grown more than threefold. The commission is increasingly focusing its attention on this subject because of its impact on economic development and the quality of life of our citizens,” Mr Yuguda said.

The SEC boss described the theme of the workshop as very relevant, particularly for a developing economy like Nigeria.

According to him, with a GDP growth rate of -1.92 per cent in 2020 and an IMF growth forecast of only 2.5 per cent for 2021, Nigeria must do more to make its citizens happy, noting that there was a need to urgently address the country’s high unemployment rate which currently stands at over 30 per cent.

He said SEC, as the apex body responsible for regulating and developing the Nigerian capital market, undertakes specific activities to ensure investor protection, preserve the integrity of the market and improve its overall efficiency through registration, surveillance and enforcement activities.

The agency, he stated, also supports market development through investor education and the introduction of robust frameworks for new products and processes in collaboration with market stakeholders.

“The activities of the commission are necessary to ensure a well-regulated, effective, deep and liquid capital market which is crucial for promoting optimal capital allocation and intermediation to finance productive investment and generate much-needed employment in the Nigerian economy,” he said.

According to him, “Over the past decade, the Nigerian capital market has grown significantly with a major uptick in activities both in the equity and bond markets, including leaps in the growth and size of Collective Investment Schemes.

“The growth, however, slowed in the past 3 to 4 years owing to a recessionary trend experienced in the economy. This is because the Nigerian capital market closely mirrors the Nigerian economy and feels the full effect of the prevailing economic situation of the country.

“To further increase the capital market’s contribution to the growth and development of the Nigerian economy, the commission is currently implementing its 10-year Capital Market Master Plan (2015-2025).

“The commission is midway into the implementation and has embarked on a review of the Plan – in collaboration with the relevant market stakeholders – to reflect new realities and sharpen its focus,” Mr Yuguda disclosed.

He, therefore, assured that the agency will continue to work assiduously towards achieving its mission of developing and regulating a capital market that is dynamic, fair, transparent and efficient, to contribute to the nation’s economic development.

“I believe that if we all contribute our quota, we can achieve a Nigeria characterized by sustainable growth and increased job creation through efficient intermediation and allocation of resources in the financial market,” he added.

In his remarks, the President/Chairman of Council of CIS, Mr Olatunde Amolegbe, said Nigeria is blessed with immense human and natural resources, but expressed dismay that the country is listed among the poorest countries in the world in terms of per capita income.

“Just recently, in 2020, the country fell into its second economic recession in 5 years, although largely attributed to the COVID-19 pandemic which affected all countries in the world. We exited the recession in the fourth quarter of the same year 2020

“However, the critical point we have to note is that, historically, it has been observed that poorer countries need a much faster rate of GDP growth than the advanced economies of the world in to maintain standards of living as well as keep up with higher population growth rate,” he stated.

Mr Amolegbe said the theme for this year’s workshop has become imperative to drive the Nigerian economy as driving the economy will require financing of the right form, type, and mix.

He said despite government best efforts, the local financial market cannot be said to have been utilized optimally as of yet adding that the trend must be reviewed and reversed.

“Not long ago the capital market was used as the fulcrum of fundraising by all the different tiers of government. Such fund is always utilized for infrastructure development. Full subscription to the government’s revenue bond which is a form of borrowing is was widely used as the risk level is almost nil.

“Besides, governments’ participation in the market is a win-win affair for the government, the market, and investors. The time has come for all tiers of government to stage a comeback to the financial market to enhance capital raise for infrastructure development. Our seasoned facilitators shall surely do justice to this time-tested theme today.

“It is obvious that accelerated development of infrastructure will bring about job creation and employment opportunities with multiplier effects on the nation’s GDP. China’s GDP grows at an average of 10 per cent per year. This has lifted over 800 million people out of poverty in recent years,” he stated.

Aduragbemi Omiyale is a journalist with Business Post Nigeria, who has passion for news writing. In her leisure time, she loves to read.

Continue Reading
Click to comment

Leave a Reply


Investors Trapped as Standard Alliance, Niger Insurance Lose Operating Licences



Standard Alliance Niger Insurance

By Dipo Olowookere

The operating licences of Standard Alliance Insurance Plc and Niger Insurance Plc have been revoked by the National Insurance Commission (NAICOM).

Although no specific reason was given for the withdrawal of the licences of the underwriting firms, the regulatory agency for the insurance sector in Nigeria disclosed that the revocation became effective Tuesday, June 21, 2022.

“This is to notify all insurance stakeholders and members of the public that the National Insurance Commission has cancelled the certificates of registration of Standard Alliance Insurance Plc, RIC – 091 and Niger Insurance Plc, RIC – 029 with effect from the 21st day of June 2022,” a statement issued on Tuesday, June 28, 2022, by the Head of Corporate Communications and Market Development at NAICOM, Mr Rasaaq Salami, stated.

In the meantime, the two insurance companies would be run by receivers/liquidators announced by the agency.

“The commission has appointed Sanya Ogunkuade Esq of Plot 217, Upper Grace Plaza, 3rd Floor (Left Wing), Shetima Munguno Crescent, Behind Julius Berger Equipment Yard, Utako, Abuja as the receiver/liquidator for Niger Insurance Plc, while Kehinde Aina Esq of Aina Blankson LP, 5/7, Ademola Street, SW Ikoyi, Lagos has been appointed the receiver/liquidator for Standard Alliance Insurance Plc,” the statement further said.

Concluding, NAICOM advised all stakeholders “to forward their enquiries to the respective receiver/liquidator for each company for their necessary action,” assuring them “of the safety and protection of their interests.”

Business Post reports that Standard Alliance and Niger Insurance are both listed on the Nigerian Exchange (NGX) Limited and with this action of NAICOM, shareholders of the firms are trapped as they may not be able to recoup their investments in the companies.

Shares of the insurance companies closed flat at 20 kobo each today, with investors trading 1,530 units of Niger Insurance shares on Monday and no trade recorded for Standard Alliance Insurance as it has been on suspension since July 2019, according to data obtained by this newspaper from the exchange on Tuesday.

Niger Insurance has shares outstanding of 7,739,479,368 units and a market capitalisation of N1.6 billion, while Standard Alliance Insurance has 12,911,030,586 units valued at N2.6 billion.

Both companies will have their stocks delisted from the bourse in the coming days.

Continue Reading


Nigeria Must Adopt Dual Circulation Economy to Prosper—Sekibo



Ifie Sekibo dual circulation economy

By Aduragbemi Omiyale

The Managing Director of Heritage Bank Plc, Mr Ifie Sekibo, has advised the federal government to adopt a dual circulation economic strategy like China to attain prosperity.

A dual circulation economy involves growing exports and expanding domestic demands from locally produced items by building higher consumption almost at the same time.

For Mr Sekibo, this strategy will work well in Nigeria because the country has the population to soak the pressure.

Speaking at an event organised by The Men’s League of Christ Church Port Harcourt, Rivers State, he also stressed that the government must address security challenges and leadership issues as they remain very critical for the success of the economic model.

At the programme themed What do Nigerians Want,? Mr Sekibo said, “On a higher note, I think one of the things that we need to achieve as a country is the issue of functional and value-adding identity management, which is still far away from us, although, some people know that we have BVN, NIMC and a few other identity capture systems they have not been as functional and value-adding, like the social security number that most people in advanced economies carry.”

The Heritage Bank chief, who was represented by the Divisional Head of Strategy and Business Solutions of the bank, Mr Segun Akanji, further explained that to achieve a prosperous economy, Nigeria needs to find ways and means by policies to build a dual circulation economy which thrives on three pillars.

According to him, the country needs to focus on building a dual circulation economy where it can expand domestic production and demand by making sure that the masses are employed.

“We need to make our people productive and stop putting subsidies in unproductive zones. When you give subsidies to people with inadequate or no income, they really cannot add value to the economy, and money has a way of flowing away due to the import of consumables from other countries and because of this, a larger portion of every consumption or cash given as subsidy gets out of the country,” Mr Sekibo stated while delivering a paper titled The Economy Nigeria Needs to Break Forth.

The bank’s helmsman further explained that to expand the domestic production, the government must give the private sector support to drive employment creation, technology, which is riding on innovation and manufacturing must be in place and, the population which is an added advantage must be well educated.

He highlighted the need to examine how the country could add value to primary production for global export, emphasizing on reduction of over-dependence on foreign markets but rather increasing local production for export, whilst also increasing demand for local products.

Mr Sekibo further affirmed that if states could function as proper federating units and take the lead of the competitive comparative advantages therein, wealth creation would be achieved that would bring about the desired changes.

Also speaking at the event, the former Governor of Anambra State and presidential candidate of the Labour Party (LP) in the 2023 general elections, Mr Peter Obi, agreed with Mr Sekibo that the country must address the issues of insecurity and leadership deficiency in order to prosper.

He lamented the huge indebtedness of the country, which he blamed on unproductivity due to the inimical situation of a high unemployment rate resulting in over 80 million Nigerians being jobless.

According to him, cumulative failure of the government over the years plunged Nigeria into insecurity, noting that other factors include the failure to migrate from sharing formula to production formula and lack of will to transform the power sector and the need to focus and support the micro, small and medium enterprises (MSMEs).

On his part, a clergyman, Pastor Ituah Ighodalo, harped on the need for leadership change, arguing that what the country needs now are leaders who have a vision and are ready to sacrifice for the common man, stating, “things must be done differently”.

Also speaking, Prof. Oyelowo Oyewo submitted that the police, power provision and railway must be decentralised as this will make states to be less dependence on the centre.

He maintained that regions are closer to the people and will boost security, the economy and the sense of belonging by the populace. He also identified data and planning as key factors in ensuring that programmes are tailored towards the people.

Continue Reading


$13bn Trans-Saharan Gas Pipeline to Boost Nigeria’s Gas Exports



Trans-Saharan Gas Pipeline

By Adedapo Adesanya

Nigeria is set to boost its gas development initiative through exports to Europe after reaching a new milestone in further opening the domestic and regional gas market via the construction of the multi-billion Trans-Saharan Gas Pipeline (TSGP) alongside Algeria and Niger.

The oil ministers of the three countries — Mr Mahamane Sani Mahamadou, Minister of Petroleum for the Republic of Niger, Mr Mohamed Arkab, Minister of Energy and Mines, Algeria, and Mr Timipre Sylva, Minister of State for Petroleum Resources of Nigeria as well as the Director Generals of national oil companies (NOCs) of the three African countries met to discuss the implementation of the TSGP on June 20, 2022, in Abuja.

During the meeting, which follows the signing of the Niamey Declaration during the 3rd Forum of the Economic Community of West African States in February 2022, parties established a task force and roadmap for the development of the TSGP.

It was disclosed that the TSGP project will mark a new era of improved regional cooperation in Africa, enhancing gas monetization and exports while scaling up exports to Europe via Algeria.

Not only will the $13 billion project drive socioeconomic growth by unlocking massive investments across the energy sector, but it will also help create jobs in various industries including energy, petrochemicals and manufacturing whilst optimizing energy production and positioning Africa as a global energy hub.

A steering committee made up of the three Ministers and Director Generals of the NOCs, established during the two-day meeting, will be responsible for updating the feasibility study for TSGP and will meet at the end of July 2022 in Algiers to discuss how to progress with the TSGP project.

With energy poverty increasing across the African continent due to limited investments in energy projects, delays in exploration, production and infrastructure rollout, the COVID-19 pandemic, and global energy transition-related policies, the TSGP project will bring in a new era of energy reliability for Africa.

With the 4,128 km pipeline running from Warri in Nigeria to Hassi R’Mel in Algeria via Niger, the pipeline will not only create a direct connection between Nigeria and Algeria’s gas fields to European markets but will bring significant benefits to Nigeria.

The pipeline will enable up to 30 billion cubic meters of natural gas to be traded yearly enhancing regional and international energy trade.

With gas emerging as the energy of the future, the TSGP project will play a critical role in positioning Nigeria, alongside Algeria and Niger, at the forefront of the energy transition.

Continue Reading

Latest News on Business Post

Like Our Facebook Page

%d bloggers like this: