Stockbrokers in Nigeria have x-rayed the country’s economic outlook and assured the investing public that the economy has strong potential to bounce back this year.
They said this at an event organised by Chartered Institute of Stockbrokers (CIS) on “The Nigerian Economic Review of 2022 and Outlook for 2023,” on Monday in Lagos.
The stockbrokers x-rayed the state of the Nigerian capital market in 2022 and forecast recovery in 2023 despite the headwinds and uncertainties associated with the economy.
The stockbrokers said the Nigerian economy was going through a tough period with headwinds, including imported inflation, huge debt service-to-revenue ratio, high exchanges rates, forex scarcity, currency depreciation, N12 trillion 2023 budget deficit, among others.
Prof. Uche Uwaleke, President of Association of Capital Market Academics, who spoke on the “Macroeconomic Performance and the Capital Market,” said contrary to projections in several quarters, government’s fiscal position was likely to improve in 2023.
Uwaleke said that would be based on the account that there would be improvement in crude oil revenue from increase in crude oil production.
He, however, said that would also be on the assumptions that crude oil price would not change and incidence of oil theft continued to go down.
“Savings from fuel subsidy removal will increase government revenue.
“Implementation of Finance Act 2022 and unification of exchange rates will boost economic growth and development,” said Uwaleke.
Also, Mr Ayo Ebo, Chairman, Research and Technical, CIS, who spoke on the Nigerian Economic Review of 2022 and Outlook for 2023 corroborated Uwaleke’s view.
Ebo said expected higher crude oil would increase government revenue in the year.
He said, “Goods account balance is expected to recover in 2022, due to higher crude oil prices.
“In 2023, the goods account is expected to benefit from reduced forex outflow on petroleum motor spirit (PMS).
“Importation, following the coming on stream of Dangote’s refinery and promotion of non-oil export.”
According to him, increased spread of working-class Nigerians in the diaspora is expected to continue supporting the strong performance of the transfers account, especially the remittance component.
“Political stability post-2022 and more market-oriented policies of the new administration are expected to drive a steady recovery in portfolio inflows over the medium term.
“An optimal growth rate for Nigeria is between five per cent and seven per cent per annum,” Ebo said.
Also, Mr Oluwole Adeosun, President and Chairman of Council, CIS, while presenting the CIS scorecard, explained that the Nigerian economy would experience growth during the year.
Adeosun, while listing the achievements of the institute in the reviewed period, stated that the institute would pursue its advocacy roles with renewed vigour.
“In 2023, we shall be working to increase the number of Nigerian universities offering both post-graduate and Bachelor’s degree courses in Securities and Investment/Capital Market Studies.
“We shall be pursuing more vigorously, activities to promote Capital Market Literacy across the entire geo-political zones of Nigeria,” he said.
According to him, in furtherance of CIS ‘Catch Them Young campaign,’ the institute shall make deliberate efforts to penetrate the university campuses more rigorously and effectively.
He noted that the CIS Academy would work harder to bring affordable world class training to its members in emerging areas like derivatives, among others.