Nigeria remains open to investors – DMO

Nigeria remains open to investors in securities and various other key projects across the country, Patience Oniha, the director-general of the Debt Management Office (DMO) has said.

Oniha, who spoke recently at Coronation Merchant Bank’s 3rd edition of interactive session series themed “Nigeria moving beyond COVID-19 – opportunities for investors”, said the government also encourages public-private partnerships (PPs).

She said the Nigerian economy remains resilient despite economic and social headwinds elicited by the COVID-19 pandemic, adding that 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, she noted.

Speaking during the panel discussion, Emmanuel Etaderhi representing 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 an 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.

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“It is very important to maintain a sustainable debt level and more importantly, to use the debt for productive purposes which can have a 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 to expand exponentially,” he said.

In his remarks, Banjo Adegbohungbe, managing director/CEO, Coronation Merchant Bank, stated that “since the advent of the COVID-19 pandemic, the global economy has been impacted adversely and this has escalated the challenge of 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.

“Nevertheless, opportunities still exist. Our economy has recovered from recession and is on a trajectory of positive growth across a number of sectors with 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,” he said.

Chinwe Egwim, the chief economist of Coronation Merchant Bank, 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.