LAGOS — Some financial experts have advised the Federal Government to use the proceeds from its $500 million sovereign bond judiciously. They gave the advice in separate interviews with the News Agency of Nigeria, NAN, in Lagos on Monday.

The Federal Government on Friday issued a $500 million bond which was oversubscribed. The bond has a 10-year tenor and an annual yield rate of 5.02 per cent.

Dr Boidun Adedipe, a management consultant, said the performance of the bond would show the level of confidence foreign investors have in Nigeria. He advised that its proceeds should be used to develop the nation’s infrastructure.

“There is the need to fast track the development of infrastructure to ensure economic growth and enhance achievement of the Millennium Development Goals,” he said.

Adedipe said the development of infrastructure would facilitate economic activities and job creation. Mr Eddie Osarenkhoe, President, Finance Houses Association of Nigeria, FHAN, said the proceeds should be used to finance projects that would lead to economic growth.

Osarenkhoe said that the proceeds would provide more financial resources for economic agents in the country to do more businesses.
“If the bond is successful, subsequent issuance of bonds would be easier and they would be oversubscribed,” he said.

Dr Titus Okunwounmu, also a financial consultant, said the proceeds would provide more financial resources for government to embark on development projects, particularly infrastructure, adding that the proceeds could serve as catalyst that would trigger-off industrial activities in the country.

Okunwounmu said the success of the bond would also attract more foreign investors into the country through the capital market. “We expect that the capital market will remain firmly in the grip of the bulls due to the success of the Eurobond in the international market,” he said.

Dr Kazeem Bello, a lecturer in the Department of Economics at the University of Ibadan, said the bond would allow both foreign investors and Nigerians in the Diaspora to have stake in the economic development of the country.

Bello said participation of international investors in the bond would open up the economy and facilitate the development of Nigeria as a financial hub in Africa. He said the over subscription of the bond was an indication of level of confidence foreign investors have in the Nigerian economy.

“It is just unfortunate that such funds were not effectively used for the development of infrastructure in the past,” he said. Registration of products and services, according Umenyin, would among other objectives assist the council in the creation of a database for products and services for the purpose of tracking their distribution and sale to consumers.

She further said it would enhance the capacity of the council to carry out its functions of monitoring products and services.

“There is hardly any product that is not either faked or adulterated.  From the pharmaceutical to the textile, beverage, ceramics, electrical and electronics, book publishing, music and even Nigeria’s fast rising home video industry, the greatest fear nursed by genuine investors remains how best to recoup their investments and remain in business amid challenges of infrastructure and the untrammelled influx of fake goods, counterfeiting and piracy in the country.”

The CPC DG also said that monitoring of products and services would also afford the consumers better information about products and services and enhance their ability to choose amongst them. And raise the revenue profile of the council through collection of registration fees.