Nigerian Stock Exchange says it can fund N1.8tr budget deficit

The Nigerian Stock Exchange (NSE) says the capital market has the depth to finance the national budget deficit and drive investments in key national infrastructure.

Addressing journalists at the NSE in Lagos yesterday, Nigerian Stock Exchange (NSE), Chief Executive Officer, Mr. Oscar Onyema said the sovereign debt market has been on the rise in spite of the current downtrend in the equities market.

He said capital market has the capacity to fund the 2016 budget deficit, which is estimated at N1.8 trillion and to further support the realisation of the Medium Term Expenditure Framework of the government.

While the equities market was in the red in 2015, the NSE bond market rose by a third. Market capitalization for the debt market jumped by 32.7 per cent to N7.14 trillion. The Federal and State Governments raised N76.5 billion and N35.8 billion in debt capital, respectively. Companies also took to the debt market to raise a total of N112 in seven new listings.

According   to him, apart from the federal government raising debt capital directly from the market, other government agencies could be unbundled and made to access the capital market for funds so as to free some cash for the government to fund other areas of development.