‘Credible, stable capital market essential for sustainable economic growth’

For a country to rank high in the global economy, serious attention must be given to the development of a credible and stable capital market.

Director-General of the Securities and Exchange Commission (SEC), Lamido Yuguda, stated this at the First Nigeria Employers Summit organised by the Nigeria Employers Consultative Association. He said credibility and stability are not guaranteed by market mechanisms alone, but also with appropriate regulation.

The SEC boss said the commission brings significant regulations to the capital market and has, over the years, continued to put in place clear and consistent regulatory frameworks to reduce regulatory and operational impediments and engender smooth functioning of the market.

“As the apex regulator of the Nigerian capital market, the SEC has executed several initiatives to build a collaborative regulatory environment for enterprise competitiveness, job creation and national development.

“Through its 10-year Capital Market Master Plan (2015-2025), which serves as the primary roadmap for the development of the Nigerian capital market, the commission has mapped out strategies to build a capital market that is the largest on the continent and one of the world’s deepest by 2025.

“The master plan’s implementation has been admitted as the 246th programme and project in the recently approved National Development Plan 2021-2025 (NDP2515033).”

He assured that the Commission would continue to enhance its regulatory framework through the issuance of rules to keep pace with market trends.

“Recent ones include rules on investment-based crowdfunding, which created an enabling environment for capital raising by start-ups and on annual renewal of registration of Capital Market Operators (CMO) to ensure only fit and proper persons operate in the Nigerian capital market”.

The SEC DG said the Commission has continued to strive to fulfill its mandate of protecting investors and creating an enabling environment for market operation.

According to him, it has also remained consistent in its mandate of ensuring that the market provides an important channel of financing for the real sector to drive economic growth; allocate risk appropriately; support financial stability and smoothen transmission of monetary policy.

However, he noted that the capital market is making efforts to do more in the provision of long-term funds to develop infrastructure for the country and support developmental projects.

Furthermore, he canvassed the need to deepen the Nigerian capital market for it to contribute the required long-term capital that Nigeria needs for business investment, infrastructure and other innovative financings.

“The gains of the capital market development will be macroeconomic development, lower transaction cost, greater liquidity, improved productivity and infrastructure development. The development of the capital market will facilitate a housing finance revolution.

“It will facilitate improved allocation of capital and provide small, medium and large companies access to the market to raise funds; facilitate foreign inflows of capital; raise productivity growth and lower unemployment. Capital market development is a spur for growth; improved living standards and efficiency. The impact of these efforts will be a superior economic performance of the Nigerian economy,” he added.

Yuguda stated that since its formation in 1957, NECA has earned a reputation as a viable platform for interaction between private sector employers, government, labour and other relevant stakeholders, adding that the commission has identified with NECA’s commitment and drive towards promoting a favourable environment for businesses to thrive and contribute maximally to national development.