By Peter Egwuatu

Capital market operators have criticized the Central Bank of Nigeria, CBN’s fixing of the value of naira, saying that the currency should be allowed to find its value through market forces.

The operators also lamented the continuous tightening of the monetary and fiscal policies by the government authorities, stressing that these measures affect liquidity in the Nigerian capital market.

Speaking to newsmen during a combined briefing organised by the Chartered Institute of Stockbrokers, CIS, Association of Stockbroking Houses of Nigeria, ASHON, and Association of Issuing Houses of Nigeria, AIHN in Lagos, the Chairman of AIHN, Mr. Victor Ogiemwonyi, told newsmen that the continuous fixing of naira does not encourage investors to invest in the capital market and the economy in general.

According to him “The CBN could have devalued the naira longtime ago rather than continuous defense of the naira. The apex bank would have allowed the naira to find its value and saved the foreign exchange reserve. The continuous use of the dollar earned by the countr to defend the naira has put the nation in tight corner as the global oil price continued to decline. This has made the dollar to rise and made foreign portfolio investors to continue to withdraw their money.”

Continuing, he said “The country needs to diversify its source of foreign exchange earnings by pursuing aggressive exports. We should reduce the rate of import and encourage domestic production for export. There is illiquidity in the capital market caused by the loss in the value of naira, drop in global oil prices, tightening of monetary and fiscal policies.”

In the same vein, the President of CIS, Mr. Albert Okumagba said that the stakeholders in the capital market have decided to engage government authorities to discuss issues that will move the market and make it contribute to the growth of the economy.

According to him “All over the world, the capital market drives the entire economy as it provides a platform for government at all tiers to access medium and long term fund to execute developmental projects.”

Speaking, Chairman, ASHON, Mr. Emeka Madubuike said “This is the time for the local retail investors to invest in the market as the value of stocks are generally low. The foreign investors should not be allowed to come back to reap the opportunity in the market.”

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