Nigeria moving beyond Covid-19 – Opportunities for Investors

Nigeria’s leading financial institution, Coronation Merchant Bank, recently held the 3rd edition of its Interactive Session Series themed “Nigeria moving beyond Covid-19 – Opportunities for Investors”.

The event which was held virtually featured expert speakers such as Ms Patience Oniha, the Director-General of the Debt Management Office, Emmanuel Etaderhi, Senior Vice President, FMDQ Group; Stephen Osho, Managing Director at Comercio Partners Capital Ltd; Chinwe Egwim, Chief Economist of Coronation Merchant Bank and Iyobosa Sorae, Treasurer and Head of Global Markets at Coronation Merchant Bank.

Delivering the keynote address, Ms Oniha said, “The Nigerian economy remains resilient despite economic and social headwinds elicited by the Covid-19 pandemic. The composition and diversification of the country’s Gross Domestic Product and revenue base make for more stable growth going forward.”

“The Nigerian government has introduced several reforms which are being implemented to attract more investments, grow and further diversify the country’s GDP and revenue. Nigeria remains open to investment opportunities that exist in securities (in the domestic and international markets) and direct investments in various key projects across the country. The government also encourages public-private partnerships.”

Speaking during the panel discussion, Emmanuel Etaderhi representing Mr Bola Onadele, Koko, Chief Executive Officer, FMDQ Group, said, “Countries borrow for very valid reasons, mostly to put them in a stronger position in terms of their economic strength. However, borrowing beyond the ability to pay, makes debt unsustainable. This has impact on investments, whether external or local, because the pricing of the instruments within the financial markets will be affected, as well as the ability to earn externally.

“It is very important to maintain a sustainable debt level and more importantly, to use the debt for productive purposes which can have multiplier effect on the economy and generate more revenue. The government can refinance debt by looking at lower interest borrowing instruments in the capital markets. It can also use the instrumentality of the financial markets to stimulate economic activities that will enable the revenue base expand exponentially.”

In his welcome remarks, Banjo Adegbohungbe, the Managing Director/Chief Executive Officer of Coronation Merchant Bank, stated that “Since the advent of the Covid-19 pandemic, the global economy has been impacted adversely and this has resulted in escalating the challenges in raising debt for more developing and emerging economies. Nigeria has not been left out of these complexities. Even though we have successfully raised debt this year, it is obvious that the challenges we face are substantial and have been exacerbated by the pandemic.

He further stated that “Nevertheless, opportunities still exist. Our economy has recovered from the recession and is on a trajectory of positive growth across a number of sectors with a demonstration of positive business sentiment and increased market activity. Today’s discourse will guide all of you and provide insights into navigating the debt market in the coming year and identifying possibilities beneficial for growth and expansion.”

Chinwe Egwim said, “Given the current global macroeconomic environment, fiscal balances have deteriorated, government debt across countries has increased and sovereign balance sheets have expanded. Although there are growing concerns around risk aversion and investors’ appetite, there are still attractive opportunities within Nigeria’s debt market for investors.

“This Coronation Interactive Session is an ongoing event that will continue to provide insightful nuggets that will help investors navigate better”.