A total of N589 was raised through the capital market by state governments to finance infrastructure development in 14 years, the Securities and Exchange Commission (SEC) has said.
Disclosing this on Thursday at the 17th Annual Stockbrokers’ Conference on Thursday in Lagos, Ms. Mary Uduk, Director, Securities & Investment Services Department in SEC, said the funds were raised between 1999 and 2013.
She said that Lagos State emerged the most active in fund raising as it had accessed the bond market four times since 1999.
Uduk said that Lagos State Government was in the process of getting approval for the fifth bond, which would hit the market in few weeks.
“States internal generated revenue cannot be enough to finance long-term infrastructural projects,” she said.
Uduk said infrastructure deficit of the country could only be solved through the bond market.
She said that the capital market offered long-term vehicle, which could be accessed through equities, bonds or mortgage bond securities.
According to her, government cannot finance the infrastructure deficit through revenue allocation estimated at 350 billion dollars by the African Development Bank from 2011 to 2020.
She said that the commission would ensure regular review of its investment guidelines and disclosure requirements for easy access to bonds in the country.
Also speaking, Mr. Victor Ogiemwonyi, the Managing Director, Partnership Investment Company Plc., said that the development of any economy would depend on the level of its infrastructure.
Ogiemwonyi said that the cost of production would be low with good infrastructure.
Mr. Tola Mobolurin, Chairman, Capital Bancorp Plc., called for enhanced collaboration between the Federal Government and private sector to bring in more private investors.
Mobolurin said that government needed to reduce its recurrent expenditure to enhance the development of infrastructure.
Dr. Sam Amadi, the Chief Executive Officer, Nigerian Electricity Regulatory Commission (NERC), said the government targeted 7,000 mega watts of electricity by December.
Amadi said that the target would depend on availability of gas supply in the country.
He said that the commission would collaborate with stakeholders in the nation’s capital market to ensure proper financing of the power sector reforms.