Chinwendu Obienyi; Henry Uche
Amidst a surging sell off on the Nigerian Stock Exchange, Minister of Power, Works and Housing, Babatunde Fashola, has called on investors to remain calm and continue playing in the Nigerian Stock Market as the fundamentals of the economy remain strong.
Fashola, who disclosed this during the Nigerian Stock Exchange (NSE) and London Stock Exchange (LSE) Dual Listing conference in Lagos recently, attributed the negative sentiments on the market to profit taking by investors due to the upcoming elections.
“The operators in the market know better than to press the panic button because the fundamentals of the economy, in my view, are still strong and I think what is happening in the capital market is normal. The Nigerian economy responds to politics like many economies and I think anyone who knows how the affairs of the world is run will expect this as some of the people cashing out or taking profit are preparing to fund the election as they need to raise money.” He said.
He added that the efforts of the present administration so far have driven the economy out of decades of poor economic decisions.
“Our key sectors have improved steadily irrespective of the fact that we are living on 40-50 years infrastructure and population has grown in manifold. If oil remains our largest export, about two-third of our income source and only 10 per cent of our GDP, it means that we must re-think that economic model and try to do something about it. For me, these are the seeds of ailment that affected Nigeria and led us into recession.
“Looking back at what happened between 2016 and 2017 when these problems came, this administration has increased capital expenditure, spending on roads, rail and airports through the budget at a time when Nigeria was earning less from oil. So it seems to me that the right prescriptions are being applied to the economy as there is increased commitment to agriculture and mining and there are arguably better fiscal controls and revenue controls from taxes.”, he explained.
Fashola added that the critical indices of the economy are heading in the right direction , saying that “the crisis is largely under control and what happens next is a matter of choice we as a people make and that choice will be a choice that will be made by you and I, a choice whether we want to start again or whether we want to keep this momentum going, a momentum that arguably going in the right direction.”
“ Perhaps not quick enough for some of us and a choice that allows us to continue to invest more in construction, mining and grow the other sectors that drive the economy towards inclusion, which is where we all want it to be. The only thing that stands in the way of optimizing the promise of the positive trends is choice made.”