Says timely delivery will stimulate activities in nation's bourse -Stock market dips by N906 billion in three months
Capital Market stakeholders have stressed the need for federal government to expedite action on the implementation of the N9.1 trillion 2018 budget to alleviate poverty and stimulate activities in the stock market.Indeed, after the January and mid February rally, the market recorded unprecedented reversal in performance contrary to analysts predictions.
The market capitalisation which stood at N15,549 trillion as at Wednesday, February 28, 2018, now stands at N14,643 trillion as at yesterday, May 21, 2018 representing N906 billion or 6.2 per cent loss.Also, the All-share index declined by 2,905,47 points or 5.9 per cent to 40,425.07 from 43,330.54 achieved as at February 28, 2018.
They argued that the three months of decline recorded in the stock market between February and April is beyond profit taking, given that the strong market fundamentals and upbeat economic data failed to support a much-expected healthy stock price recovery.The stakeholders who expressed concern that the budget that should have started running since the beginning of the year was passes almost half way into the year, maintained that implementing the budget within the appropriate time would enable the executive to disburse funds to key priority sectors of the economy.
Speaking in an interview with The Guardian, they bemoaned the uncertain nature of the nation's budgetary process, noting that the delay in the passage of the budget has caused untold hardship to the populace.
According to them, specific time frame must be set for the delivery as the federal government has barely few months to implement the document.Therefore, they suggested the enforcement of discipline of timing into the budgetary process, stressing that delivering a budget halfway into the financial year does not augur well for the overall economy.
For instance, the Publicity Secretary of the Independence Shareholders Association of Nigeria, Moses Igbrude who noted that it is commendable that federal government has eventually passed the 2018 budget, however noted that having the willingness to implement the budget if paramount.He said there is an urgent need for federal government to give priority to key infrastructural projects and human capital development, to reduce unemployment and alleviate poverty.
"It is a good thing that the NASS has eventually passed the 2018 budget, that means the government and its MDAs have no reasons to give excuses.Passing the budget is one thing and having the willingness to implement it is another ball game.
"They should immediately start implementing the budget by releasing funds to essential sectors of the economic that will have direct effects on Nigerians. They should pay contractors, workers and pensioners they have owed for a long time."They should give priority to key infrastructural projects especially human capital development, electricity and health. Unemployment is a major issue in the country by focusing on production and agriculture sector it will jump start economic activities.
"This will affect the capital market positively. If the budget is well implemented the private sector will create the needed employment, companies will declare good results, which will translate to good dividends and price increase in the market.
"I am appealing to the government to work more with the private sector to improve economic growth of the country. Time is not in their side; they should understand the importance of the capital market and make use of the market to the advantage of the economics and Nigerians," he added.
The Managing Director of Crane Securities Limited, Mike Ezeh described the budget as the most delayed in the last 19 years, noting that every aspect of the economy has been on hold since the beginning of the year.
"It is a relief that the 2018 budget is eventually passed knowing that this is the most delayed budget in the last 19yrs. It portends a good omen to the market and the economy."The Chief Operating Officer, InvestData Limited, Ambrose Omordion, said the budget would boost activities and support the nation's economic recovery and development.The President, Proactive Shareholders Association, Taiwo Oderinde also urged federal government to implement the budget to the letters and avoid the practice of rolling over development plans into another year.
He called for proper monitoring of the budget to ensure effective implementation, noting that N1.5 trillion spent on infrastructure in 2017 budget had not reflected on the economy."For the budget to make meaningful impact on the life of Nigerians and economy, government must change its disbursement and implementation style so that projects execution will be fast," Omordion said
"I am happy for finally passed d budget after a prolonged delay. Many corporate organisations and individuals can now plan based on the passed budget. My advice for government is to implement it to the letters especially in the provisions of employment, security, improving the health sectors among others. "