…Calls for appropriate policies to attract FDI
By Peter Egwuatu & Nkiruka Nnorom
The Chief Executive Officer, Cowry Asset Management Limited, Mr. Johnson Chukwu, has advocated the need for the federal government to adopt a viable Private Public Participation, PPP scheme and floating of infrastructural bonds to address the huge infrastructural gap other than the ways and means that has long term negative impact on the economy.
He further said that Nigeria needs appropriate policies that will attract Foreign Direct Investment (FDI) into the country.
Chukwu in his presentation at a virtual meeting organised by the Capital Market Correspondents Association of Nigeria themed, “Addressing Nigeria’s Fiscal Challenges – Exploring Alternative Fund Approach”, said: “Our FDI which is what goes to the private sector and infrastructural development has in the last six years (2015-2020) remained nearly flat.
“On revenue, Chukwu said: “Nigeria has a huge revenue shortfall which means we have to look for funds outside government budget. Total revenue has remained largely flat between 2015 and 2020.
“In 2015, the total revenue realised by the Federal Government stood at N3.24 trillion as against N3.47 trillion reported as of November 2020. There has been a steady growth in expenditure; as of 2015, the total expenditure stood at N4.76 trillion in contrast to N6.24 trillion recorded from January to November 2020.
“The challenge we have in this country is a revenue challenge, we don’t have the revenue size to support the type of government we run. That’s why our recurrent expenditure has been increasing while our revenue remains flat. The government needs to interrogate issues of recurrent expenditure” he said.
On the outlook of the capital market in 2021, Chukwu said: “The market would sustain the positive outlook performance in 2020, despite the effects of COVID-19 and the accompanying economic recession.
“This is also justified by the strong fundamentals of the several quoted companies on account of their resilience during the pandemic and the likelihood that they will remain resilient in 2020.”