CHUKWU DAVID reports on the resolve by the Senate to work in collaboration with stakeholders in the Capital Market to resuscitate and strengthen the sector
Since the Capital Market in Nigeria witnessed a major downturn in the last decade following the devastating global crash in the market in 2008, both government and stakeholders in the sector have been doing everything possible to restore the lost glory of this very critical segment of the nation’s economy.
The parliament, especially the National Assembly, is particularly deeply concerned about the non-viability of the Capital Market in Nigeria, and has decided to play its part to ensure that the sector gets rejuvenated to a point where it becomes a major player and sustainer of the economy.
It was against the backdrop of lingering dwindling operations of the Capital Market in the country that the chairman of Senate Committee on Capital Market, Senator Ibikunle Amosun, last week, facilitated an interactive session of the committee with stakeholders in the Market, with a view to fashioning out ways and means of revamping and strengthening the market to function effectively and deliver the needs of the citizenry.
In his opening remarks during the session, Senator Amosun promised that the Senate would come up with legislations to strengthen the sector for it to contribute meaningfully to the economic fortunes of the country.
He said that the meeting became necessary because the country’s economy is facing serious challenges occasioned by the outbreak of COVID-19 pandemic and the recent #EndSARS protests, which led to mass destruction of public and private property across the country. According to Amosun, the Senate was not unaware of some of the challenges facing the growth of the Nigerian Capital Market but assured that the committee, which has oversight responsibility over the sector, will support with necessary legislations to address the problems and propel the Nigerian Capital Market into greatness.
He further stressed that there was need to strengthen the Commodity Exchanges and make the market robust and functional, saying that the Capital Market needed to re-activate the alternate market, and bring on board unlisted multinational companies, in order to develop a robust Capital Market.
His words: “As stakeholders in the capital market, I urge you all to see this interactive session as an avenue for us to brainstorm on ways we can collaborate to meaningfully strengthen the Capital Market, so that it can continue to function as the gateway to economic development of our nation.
“This interactive meeting is very apt, especially coming at a time like this when concerted efforts are required to revive our economy, which has been negatively affected due to the outbreak of COVID-19 and the recent #EndSARS protests.
“This is the most crucial moment for our economy as Nigeria and indeed the whole world continue to grapple with economic hardships such that has not been witnessed before. Consequently, it behooves on us as stakeholders to come together with a view to reviving the economy and strengthening the confidence of the much needed investors in the Capital Market.
“The Senate is not unaware of some of the challenges facing the growth of the Nigerian Capital Market. It is our desire as the committee saddled with the oversight responsibility to support you with necessary legislation to propel the Nigerian Capital Market into greatness. Please be assured that we will expedite action on the passage of relevant laws, amend, and enact new laws where necessary.
“There is equally the need to strengthen our Commodity Exchanges and make the market robust and functional. Fur-thermore, it is our firm belief that we can work towards domestication of our product to encourage local investors.
The Capital Market needs to re-activate our alternate market and bring on board unlisted multinational companies, in order to develop a robust Capital Market. “These informal sectors, as we are all aware, are driving forces that will dominate our nation’s economy.
I encourage all the stakeholders to strategise on how to encourage Micro, Small and Medium Enterprises (MSMEs), and multinational companies to participate in the Nigeria Capital Market. “Let me remind us that, the money market is already dominating the capital market due to reasons such as; system failure, lack of transparency in operations, insider abuse, etc. To this end, the Investments and Securities Act (IST) will be reviewed. We urge all the stakeholders as a matter of urgency to intimate us all areas that require legislation in order to promote the Capital Market.
“The issue of Unclaimed Dividends must be thoroughly dealt with by SEC and CSCS, for investors’ confidence and growth of the Capital Market. Public enlightenment and awareness of operations/ dealings within the Nigerian Capital Market must be seriously emphasized, taking into cognizance the need to sensitize the general public on their roles.” Meanwhile, one of the stakeholders and Director-General of the Securities and Exchange Commission (SEC), Lamido Yuguda, in his submission at the event, said that the Capital Market would soon be strengthened with Finance Technology, explaining that Fintech relates to any business that uses technology to enhance or automate financial services and processes, thereby fixing problems in financial infrastructure.
He explained that Fintech companies operate by receiving information from customers before helping them make payment, refund a sale, look up details of a transaction and set up a billing plan, among other things. He revealed that 2020 saw the rise of fintech startups in Nigeria. On plans to launch into fintech, the SEC Director General said: “We are implementing the Fintech road map. We are also contextualizing the regulatory independent framework to on board Fintech into the Capital Market. We have just released draft rules for the crowdfunding in our regulation.
We have received set of comments from the market and very soon we will be releasing these rules to the public.” The Chairman of Investment and Securities Tribunal (IST), Mr. Amos Azi, who also spoke at the event, disclosed that his organization has determined cases worth over N800 billion in favour of various investors in 13 years of its existence.
Azi added that IST has delivered on its major Key Performance Indicators (KPIs) by delivering judgements within 90 days, from commencement to judgement day, publication of its law report and sensitization. “From inception till date, we make bold to say that the IST has adjudicated and determined cases of monetary value of over N800 billion in favour of various investors, which we believe is very encouraging to investors. Investors now know that they have where to approach in case of a dispute,” he said.
He further stated that IST had established four zonal offices in the country in order to bring adjudication closer to investors instead of traveling to Abuja. According to him, the offices are in Lagos, Enugu, Port Harcourt and Kano.
Azi said that the IST had 10 volumes of its Law Reports that are being used by both academicians and practitioners in the Capital Market. He also noted that the tribunal is being confronted with the challenge of a befitting courtroom and office space, stressing the need for all institutions in the Capital Market to contribute towards the funding of the IST.