For Nigeria to adequately finance its developmental projects using long term credit facilities that boost economic performance, it must begin to utilise the Capital Market as a fund raising vehicle, the joint committees of the National Assembly on Capital Market and Financial Institutions, have said.
The joint committees which yesterday, raised the alarm over the inability of Nigerian commercial banks to provide long term financing instruments for projects in the country, also disclosed that second edition of its bi-annual conference on capital market would be opened by Vice President Yemi Osinbajo on Monday.
Chairmen of Senate and House committees on Capital Market, Senator Foster Ogola and Honorable Tajudeen Yusuf, had while briefing journalists on the impending colloquium raised the red flag on the continuous reliance on foreign loans to finance long term projects.
They stated that the compelling nature situation regarding external sources of funding was exacerbated by the fact that no Nigerian bank currently can fund long-term projects in the country, which is why attention should now go to the capital market.
Senator Ogola who led the briefing on Monday, noted that big and long term project financing, like industrial, infrastructural and farming projects among others can only come from the Capital Market which now has huge financial inflows from pensions and insurance deposits.
“No Nigerian bank can fund long term project. The capital market is now funded by insurance and pension funds,” Ogola said, adding that pension and insurance deposits are now being invested in the capital market.
On his part, Chairman, House Committee on Capital Market, Ayo Tajudeen Yusuf said parliament was deploying legislative tools and frameworks generated from the successes recorded from the first forum in 2016 to rejuvenate the capital market, as well as develop the economy through infrastructure financing.
On the benefits of ongoing legislative efforts to agric sub-sector, Hon. Yusuf disclosed that the National Assembly was bent on developing the commodity exchange market with a view to empowering farmers whose produces have gone largely un-priced and unappreciated over the years.
He added that such development would expand commodity exchange and create commodity brokers as it is obtainable in insurance and stock market, he explained
Pitting the thematic concern of this year’s event as “Capital market as a catalyst for economic growth and development”, the lawmakers explained that they were committed to enhancing the Nigerian capital market’s potentials towards enabling it to mobilize multi-billion dollar development funds from across the globe towards a fast-paced execution of infrastructural projects nationwide.