The Federal Government (FG) has announced plans to privatise government assets, raising N298.486 billion in profit.
The revised Medium-Term Fiscal Expenditure Framework (MTEF) for 2024–2026 indicates that the revenues from privatisation for the 2024 fiscal year would amount to N206.182 billion, a 44.8% increase from the previous year.
In response to the planned privatisation of government assets, Professor Uche Uwaleke, President of the Association of Capital Market Academics of Nigeria, ACMAN, stated:
“It is advisable for government to privatise its assets through the stock exchange. In that way it would be more transparent and beneficial to all Nigerians. The people will share from the wealth of the nation rather selling to few hands or cronies, family etc.” He further noted that if government assets are listed on the stock exchange it would help improve the value of market capitalisation and the capital market would reflect the growth of the economy in general.
“With the nation’s infrastructure investment need which had continued to widen, and government debt profile which is substantially high, mobilising long-term financing through the capital market and deploying domestic market borrowings into infrastructure bonds had become critical to achieving the target. Government should be careful in the domestic borrowing in order not to crowd out the private sector from mobilizing funds for infrastructural needs. Most times, government raises bonds to finance the recurrent expenditure while the private sector is not encouraged to float private bonds that are tied to infrastructure which is what Nigeria needs,” he said.
Speaking at the Capital Market Correspondents Association of Nigeria, or CAMACAN, conference in 2023, Uwaleke stated that the National Development Plan (NDP) financing through the capital market will largely depend on removing obstacles to its growth. He also noted that efforts to address the current issues facing the Nigerian capital market will unavoidably pave the way for it to play a significant role in not only achieving the growth targets outlined in the NDP but also realising the country’s goal of becoming a $1 trillion economy within the next six years.
cc: Vanguard Ng
