The Federal Government, FG, has proposed to rake in N298.486 billion from privatisation of government assets in 2024.
The revised 2024 – 2026 Medium-Term Fiscal Expenditure Framework, MTEF, show that privatization proceeds for the 2024 fiscal year represents an increase of 44.8% against N206.182 billion in 2023.
Commenting on planned privatization of government assets, Professor Uche Uwaleke, President, Association of Capital Market Academics of Nigeria, ACMAN, said: “It is advisable for government to privatise its assets through the stock exchange. In that way it would be more transparent and beneficial to all Nigerians. The people will share from the wealth of the nation rather selling to few hands or cronies, family etc.” He further noted that if government assets are listed on the stock exchange it would help improve the value of market capitalisation and the capital market would reflect the growth of the economy in general.
Uwaleke stated further: “With the nation’s infrastructure investment need which had continued to widen, and government debt profile which is substantially high, mobilising long-term financing through the capital market and deploying domestic market borrowings into infrastructure bonds had become critical to achieving the target. Government should be careful in the domestic borrowing in order not to crowd out the private sector from mobilizing funds for infrastructural needs. Most times, government raises bonds to finance the recurrent expenditure while the private sector is not encouraged to float private bonds that are tied to infrastructure which is what Nigeria needs.”
Meanwhile, speaking during the 2023 conference of the Capital Market Correspondents Association of Nigeria, CAMACAN, conference, Uwaleke said that financing of the National Development Plan, NDP, through the capital market will depend to a large extent on breaking the barriers to its development, pointing out that efforts to meet the current challenges of the Nigerian capital market will inevitably set the stage for it to play a prominent role in not only achieving the growth targets set in the country’s NDP but also the dream of a $1 trillion economy within the next six years.
