AS President Olusegun Obasanjo hands over the reins of leadership on May 29, 2007, what is his administration leaving behind in the economy? The Guardian last week sought the opinion of Mr Greg Otsu, a player in the Stock Market, which is the hub of investment activities in the nation's economy, on the Performance of the market under Obasanjo's government since 1999.

On growth in the capital market

Basically, the situation in our capital market has moved from a period of million-naira benchmark to Trillion naira during the eight years tenure of President Olusegun Obasanjo.

As at today market capitalisation is in the region of N7 trillion and in the last three years, we are looking at an operator's capital base of 60 to 70 million and we have moved away from million now to billion after the second dispensation.

On boost in foreign investment

When the International Community realised that we have actually moved from militarocracy to democracy, a lot of confidence was restored. This brought about international recognition and searchlight being beamed on Nigeria. Last year, the country was rated "BB" by international rating agencies. That means any investor can now come into the country by channelling his investment fund through the Central Bank of Nigeria (CBN), which will also take care of the dividend from any investment at any time the investor wants it.

Ours is a ready economy and we have the population. The census that was conducted last year put the country's population at 140 million. But while some of us disagreed with that figure, some world organisation bodies have reckoned that we are about 180 million.

What this means is that Nigerian economy is very viable because it has a large population with an enormous buying power. Obasanjo's government has been able to attract the confidence of foreign investors.

On foreign road shows

The Nigerian Stock Exchange during the tenure of Obasanjo did a lot of road shows, taking Nigerian economy to the world, selling the merit and benefits to the entire world. The Exchange was able to market Nigerian to the Nigerians in Diaspora, to China, Europe even Canada and US. This shored up International confidence and attracted the Nigerians in Diaspora and other International Investors who are now jostling to come to Nigeria to invest.

On consolidation in the banking industry

During the tenure of Obasanjo, we had bank consolidation and that is one of the major achievements of this administration. That singular achievement alone has attracted a lot of international players to our market. Prominent World financial institutions are partnering with our local banks to do business. The CBN has given a benchmark to any bank that wants to access our foreign reserve to have one billion-dollar Capital base. And we have a lot of banks that have met that. Banks like Zenith, First Bank, Union Bank and a few others have met the requirement.

So, globally, we have come of age during the eight years of Obasanjo's administration. This was due to the democracy in the country that has survived all these years and Obasanjo government that is able to restore the confidence in Nigeria and also in foreign investors who now have no fear when bringing their money.

On privatisation

Another achievement is the privatisation exercise, which is being conducted by the Bureau of Public Enterprises (BPE). They conduct the exercise in the open. This has been a major milestone. A lot of foreign investors have come to bid. Some of them lost and some won; and out of those who won, some have partnered with local industries here to continue in business. All these boil down to the ability to play in an open and transparent economy. We have nothing to hide. You are free to come and look at whatever we are doing, bring in your money and you are free to take back your money.

Under the Obasanjo's privatisation programme, foreigners are allowed to own 100 per cent. Gone are the days when foreigners have to partner with local entrepreneurs to own industries.

All these have a lot of effects on the Nigerian Capital market, because everything drops at the doorstep of the market. Anybody or company that wants to raise capital outside the little efforts he has made as an individual has to go to the Nigerian capital market to get more funds to enhance their business.

Obasanjo has always said that Nigerian capital market is one major achievement that his administration has been able to achieve and that any economy that cannot grow its capital market cannot survive.

The capital market regulators have under Obasanjo's regime, taken the capital market to greater heights. They have taken the market to the doorsteps of foreign investors through road shows, through the sponsoring of international as well as local journalists, they have met Nigerians in Diaspora and they have also expanded the Stock Exchange by introducing and installing various information technology, expanding the network to the wider world. The Nigerian Stock Exchange has one of the best website, has one of the best Reuters that can give information as at and when trading is going on.

They also introduced trade alert system that allows an investor or shareholder to receive immediate notice if anything is happening to their stock. And that is a major confidence to any investor in the world.

And because of this confidence, the players in the capital market, that is, the stockbrokers, are also looking outside to bring in a whole lot of investors to invest in our market here. Some have gone a step further to merge with international investors and international stockbrokers, fund managers etc.

Right now, there are a lot of brokers who have offices in the U.S. and other parts of the world; and who are directly trading with our floor of the Nigerian Stock Exchange here right from their offices in overseas.

In short, the stock market in the last two years has witnessed enormous rise in market capitalisation; and when you look at the index, you will notice that the market has done tremendously well. As at the last quarter, which ended on March 31, 2007, the market has done 40 per cent above what was done last year in the same period. If the index is already 40 per cent above the level above what we did in the correspondence period of last year, it then means that in the third quarter of this year, we would surpass the index of last year. What this means is that, the train of Nigerian capital market is moving at a top gear speed.


There Are Still Unfinished Projects, Says Ajagu


Dr Ausbeth Ajagu, President, Academy for Entrepreneurial Studies, Nigeria (AES), said that the eight years of the Obasanjo administration is no doubt one filled with some expectations fulfilled and others unfulfilled.

According to him, after the military interregnum that lasted for what looked like ages, Nigerians were happy to have a democratically elected government inaugurated in May 1999. There were hopes of better days ahead and great expectations. After eight years in the saddle, it is time to look back at what it was then and what it is now.

On telecommunications sector, one would not but score the Obasanjo administration a pass mark for the reforms in the sector especially the introduction of the GSM. With this, Nigerians now communicate with relative ease though the cost (tariff) and other charges is still something to worry about

On education, there is a commendable improvement in that sector. With the reforms going on in the sector, one can conveniently score the administration above average.

On banking reforms/debt cancellation, this is one sector that the Obasanjo administration has recorded commendable success. Before now, Nigerians had no confidence in the banking sector due to the ugly experiences of bank liquidation in the past, which has wrought havoc on many people. But with the reforms, there is a reasonable degree of confidence by Nigerians in the banking sector now.

Similarly, one must equally commend the efforts of the administration for successfully exiting Nigeria from the list of debtor nations via debt cancellation given by the Paris and London clubs. Though, the gains of the debt cancellation is yet to be observed or felt in the life of the average Nigerian, it is instructive to commend the move hoping that the gains may be felt in the near future since some of these things take time to translate into gains to be felt.

On infrastructure

On infrastructural development like the roads, one can say without any iota of doubt that there is nothing to celebrate about the state of our roads in regard to the attention given to same by the Obasanjo administration in the past eight years. Going through the length and breath of this country, one would observe that there is no much difference between the state of our roads prior to the Obasanjo administration and what it is now. Our air and sea transport has not fared any better with the incessant air mishaps that has occurred in recent times.

On corruption

The Obasanjo administration in the last eight years has made spirited efforts to deal with the malaise through the Economic and Financial Crimes Commission and other agencies. But many have faulted the administration's efforts in this regard describing it as half-hearted and selective. Be that as it may however, one cannot totally dismiss the administrations fight against corruption as it has recorded some successes no matter how half-hearted and selective it may be.

Another aspect of the economic sector where the government of Obasanjo did not achieve much is in exchange rate. The administration has been unable to bring down the exchange rate of the naira or at least maintain a stable rate. Rather, the naira has continued to depreciate in value compared to other currencies, which are appreciating. Thus, the administration has failed in that regard.

Security

One may say that this is one sector where the Obasanjo administration has failed woefully. It has failed to protect and ensure the safety of lives and properties of Nigerians with the rampant cases of theft, armed robbery, assassination and other violent crimes. There is no gainsaying the fact that one of the most important duties of a government to her citizenry is the protection of their lives and property. But this has not been the case in the country. Many Nigerians have lost their lives in broad daylight while armed robbery attacks and other forms of violence have become the order of the day. Our security agencies seem to be helpless in the face of such untold threats to lives and properties of Nigerians.

On health

The sector is another sector that has not received the expected transformation. Facilities in the sector like it was before are still comatose with the health of Nigerians being the worst for it.

The incoming administration should pay more attention to these areas and try as much as possible to make their own mark in these areas like the out-going government did in the areas of bank consolidation, external debt exit and GSM introduction in the country.