The Securities and Exchange Commission (SEC) has said that Nigeria’s huge budget deficit could be funded by harnessing available finance windows from sustainable finance investors and canvassed increased green bond issuances to tackle the country’s infrastructure deficit.
The Director General of the commission, Mr. Lamido Yuguda, made these recommendations on Monday at the hybrid launch of the FMDQ Green Exchange by the FMDQ Securities and Exchange Limited on Monday, in Lagos.
The investment expert noted that sustainable finance, which enables taking environmental, social and governance (ESG) considerations into account during investment decisions in the financial sector for long-term investments, was required to incentivize market participants to be more conscious of long-term risks and opportunities.
The SEC boss clarified: “We believe that the huge budget deficit and infrastructure gap in the country can be financed by harnessing available finance from sustainable finance investors and interest groups globally
“For this to happen, the right conditions and incentives need to be in place. This includes incentivising market participants to be more conscious of long-term risks and opportunities.
“Improving access to retail investors and supporting institutional investors to direct their capital towards a long-term impact, enhancing trust in green financial products.
“Also, providing clean and clear information for those who invest in them and providing the necessary support and policies to create the environment for innovative ideas for green finance to thrive.
“SEC, on its part, tries to deliver coordinated and coherent policy advice, capacity building and regulatory support to build the momentum for a green economy”, Yuguda added.
The Director General further noted that sustainable financing could be a means by which the organized private sector can partner with the government in its drive for the nation’s sustainable economic development, adding that the capital market has approved the issuance of some green bonds but there is still opportunity for more issuances if stakeholders can do more in green and sustainable finance products.
This is even as noted for the past few years the FMDQ, had leveraged its innovativeness with the introduction of new platforms, processes, innovations and even players.
It would be recalled that President Muhammadu Buhari had a few days ago disclosed Nigeria required the sum of $1.5 trillion in ten years to close her infrastructure gap.
The President gave this hint at the Glasgow COP 26 high-level side event on improving global infrastructure, hosted by President Joe Biden of the United States, EU Commission President, Von Der Leyen and the UK Prime Minister, Boris Johnson.
