The Securities and Exchange Commission (SEC) stated that Nigeria’s huge budget deficit and the infrastructure gap in the country can be financed by harnessing available finance from sustainable finance investors, also calling for green bond growth to address the country’s infrastructure deficit.
This was disclosed by the Director-General, SEC, Mr Lamido Yuguda, at the hybrid launch of the FMDQ Green Exchange by the FMDQ Securities and Exchange Ltd, on Monday, in Lagos. He added 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 needed to incentivise market participants to be more conscious of long-term risks and opportunities.
What the SEC said
“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,” Yuguda said. He recalled that the United Nations recognises that green financing plays a major role in delivering a number of its Sustainable Development Goals (SDGs).
He stated, “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 advise, capacity building and regulatory support to build the momentum for a green economy.”
Yuguda noted that sustainable financing can be an avenue for the private sector to partner with the government in the overall drive for prosperity and economic development, adding that the Nigerian capital market has recorded some green bond issuances but there is still ample room for additional issuances as stakeholders within the sector can do more in terms of green and sustainable finance.
He also stated that the FMDQ, for some years now, has earned itself a reputation for innovation in the Nigerian capital market with the introduction of new platforms, processes, innovations and even players.
In case you missed it
Recall Nairametrics reported last week that President Muhammadu Buhari disclosed Nigeria requires the sum of $1.5 trillion in ten years to close its infrastructure gap. The President disclosed this 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.