Operators in Nigeria’s capital market have thrown their weight behind recent measures pronounced by the Federal Government to hedge the economy against negative effects of a volatile oil market.
The operators say the recent drop in oil prices currently being witnessed globally is a test for the Nigerian economy.
This has necessitated policy adjustments by the Federal Government to ensure that measures are put in place to absorb the effects of the drop in oil prices.
“The Chartered Institute of Stockbrokers commends the fiscal stand taken by the Federal Government of Nigeria in recent global economic developments. Beyond the required fiscal and belt tightening measures, the CIS rates in particular, the statement by the co-ordinating Minister for the Economy (CME), relating to spending priorities, human capital development, education, health care and MDGs.
“The Institute is set to mobilise and engage unemployed qualified finance related individuals and the lower level cadre to create continuous education for the up-coming potential investors. This we believe, will close the existing unemployment gap in the economy,” said the Chartered Institute of Stockbrokers (CIS) in their position, signed by Albert Okumagba, President/Chairman of Council, CIS.
“In order to fortify the needed human capacity development, the Institute has commenced a professional diploma in Securities and Investment Certification.
“ This is an intermediate/foundational entry route for the benefit of undergraduate students and secondary school leavers wishing to start or progress their career within the financial services industry.
“This is to afford them the opportunity of writing the examination while they are still in the undergraduate school, or seeking for admission into tertiary institutions,” the CIS president stated.
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“The downward review of benchmark from $78 to $73, plugging loopholes and waste as well as cut unnecessary expenditure are prudent steps from the Federal Government”, said the Association of Issuing Houses of Nigeria (AIHN) in their position paper signed by Victor Ogiemwonyi, chairman Association of Issuing Houses of Nigeria.
According to AIHN, “The strategy of Federal Government to strengthen the private sector, most especially the sectors that drive economic growth, such as Agriculture and Housing is in the right direction.
“ As properly identified by the Federal Government, the drop in oil prices presents opportunity for diversifying the economy, with the private sector being the major driver in order to increase non-oil revenues with less focus on oil.
“We will like to advocate for greater harmony in the implementation in the fiscal and monetary policies at this critical time. We strongly believe that Nigeria should remain focused in developing infrastructure to support economic development and growth.
“There are still massive investment opportunities for discerning investors to fund the infrastructure gaps.”
The Association of Stockbroking Houses of Nigeria (ASHON) in their position paper signed by Emeka Madubuike, its chairman, said: “Recent macro-economic development (specifically the fall in crude oil prices) have impacted on the Nigerian economy with attendant panic sales by short term investors participating in the stock market.
“The reality of the current macro-economic situation in the country, in terms of oil prices, exchange rate, and fears of possible devaluation has given rise to the flight of foreign portfolio investors who account for about 57% of the equity market, precipitating a sharp drop in market indicators – 19.63% year to date.”
ASHON said: “We, the Association of Stockbroking Houses of Nigeria (ASHON) welcome the fiscal policy plan being implemented by the Federal Government on the issue of increased revenue generation from non-oil sources; being frugal on the expenditure side,tightening spending.
“We also welcome the fact that the co-ordinating Minister of the Economy (CME) is focusing on improving the internally generated revenue (IGR). This contingency plan has given rise to adjustment of the medium term expenditure framework and is proposing $73 per barrel for the 2015 budget, ” ASHON said.
