The Capital Market Committee has said it is finalising work on a 10-year master plan aimed at ensuring the guided growth of the Nigerian capital market.
The master plan, which is meant to cover the 10 year-period from 2015 to 2025, is specifically aimed at increasing the depth of the capital market, increasing foreign direct investment and to diversifying the sources of capital, among other things.
The plan was disclosed at the third quarterly meeting of the CMC in Lagos on Thursday, where stakeholders reviewed the state of the capital market and received reports from various sub-committees of the CMC, which is chaired by the Director-General, Securities and Exchange Commission, Ms. Arunma Oteh.
The Chairman of the Capital Market Master Plan Committee, Mr. Dotun Suleman, said his sub-committee found that the capital market was far from where it ought to be and that its contribution to GDP was low.
He said, “To make sure we are objective in our assessment, we benchmarked Nigeria with Brazil, South Africa and Malaysia and came to the conclusion that the Nigerian capital market is underdeveloped and needs to be much more robust if it is going to play a significant role in the national aspiration to be a top 20 economy by the year 2020.”
The objective of the master plan, he said, “is for us to have a capital market that will participate adequately in the emergence of Nigeria’s global top 20 economy.”
“What that tells you is that there is a lot of work we need to do between now and 2020. The document we have come up with has defined a number of initiatives that we need to embark upon to move the capital market to where we think it needs to be 10 years from now,” he added.
According to him, one significant challenge is the need to redefine and broaden the understanding of the capital market to include all those who have roles to play.
He also said more creativity was needed with regards to products and the use of channels, among other steps including the need to develop a national savings strategy to help accumulate long-term funds, which was in short supply in the county.
“So, we have a document that is still work in progress. It still needs to go through several alterations in terms of marketing it to the stakeholders to make sure there is sufficient buy-in so that we can begin the journey to achieve the vision.
“The vision by the way is that we think that by the year 2025, we should have a capital market that is the most modern and most competitive in Africa,” he said.
One of the key challenges discussed at the meeting was the lack awareness and knowledge about the capital market and the dearth of participants. And the Chairman of the CMC’s literacy committee, Mr. Ariyo Olusekun, highlighted the problem in his presentation, stressing that research had shown that the level of capital market literacy in Nigeria stood at 16 per cent.
While he acknowledged the numerous efforts being made to enhance capital market literacy, Olushekun said, capital market literacy programmes in the country currently “lacks strategic direction and proper coordination.”
“There should be an increase in public awareness as the Committee has suggested that capital market literacy programs to be included in curriculum of professional bodies, schools and Universities. Others are exhibitions, road shows and annual public lectures and so on,” he said.
Punch
