The Chairman, Association of Securities Dealing Houses of Nigeria (ASHON), Mr Sam Onukwue, has said that foreign exchange, forex, speculators are hurting the economy.
In an interview, Onukwu, who is a Fellow of Chartered Institute of Stockbrokers (CIS), also said that the capital market remains one of the best sources of medium and long term finance for government to bridge infrastructure gap in Nigeria.
He stated: “We at ASHON have always canvased that government at all tiers should take advantage of the market to float fixed income securities to fund infrastructure projects. The continuous over-subscription of SUKKUK Bonds signifies investors’ appetite for safety of their capital in a recessionary period. The capital market has absorptive capacity to fund most of the infrastructure and this will reduce the government’s dependent on borrowing.”
While commenting on the outcome of ASHON’s Annual General Meeting (AGM), he said: “It was a very successful AGM. The Governing Council, through my Statement, informed our Members, the series of ASHON’s engagements with some critical stakeholders as part of our market development functions. The Council and Management, were commended on the prudent management of resources , especially , the downward trend in the budget for transportation, despite the hike in the pump price of petroleum and allied products. We shall continue to collaborate with other stakeholders to build investor confidence in the market.”
On the current state of Nigeria’s economy, Onukwue said: “The Federal Government should address the macroeconomic vagaries such as exchange rate volatility and rising inflation rate. These amongst others have continued to affect business decisions. “We have limited sources of foreign exchange. The Federal Government has announced its plan to boost the supply side. The implementation should be accorded utmost urgency. The concern is the source of the demand pressure for forex. Is it from genuine business people and organisations or speculators? “Speculators are hurting the economy by buying Dollar to keep as a store of value for speculative purposes. Government can reverse the ugly trend by addressing the supply side.
“If there is stability in the exchange rate, it will have multiplier effects on other economic activities and boost the value of the Naira. ASHON has at several times urged the federal government to tap into an array of investment in the commodities space to generate employment opportunities, boost export trade and grow the Gross Domestic Products (GDP).
“Solid mineral is a cash cow. Government should direct its searchlight to the sector to take control of the revenue and protect the revenue from going into private pockets.”