Finance and economy experts are optimistic that the pedigree of the new Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun and the pro-market outlook of the President Bola Tinubu’s administration will provide catalytic base for several fiscal and monetary reforms.

As Edun takes the oath of office tomorrow, analysts are unanimous that finance and economy are at the centre of the new government’s reforms, and the success of the entire government’s agenda depends to a large extent on the success of the finance and economy team.

President, Chartered Institute of Stockbrokers (CIS), Mr. Oluwole Adeosun, believes that Edun, a renowned financier, has the requisite knowledge and experience to redirect the economy for sustainable growth.

He outlined the key priorities for the new minister to include the resolution of the foreign exchange (forex) crisis, moderating inflation and driving major infrastructural projects.

“The resolution of the crisis in the forex market should be a top priority as we can see many big corporate organisations posting heavy losses as a result of devaluation of the naira arising from subjecting the currency to a free-float. If the government allows the losses to crystallise, many companies in the real sector, particularly those in the manufacturing sector with huge foreign currencies exposure will collapse early next year.

“In this regard, we are recommending managed-float which will allow government to intervene from time to time. We are also expecting the government to roll out palliatives in real terms without further delay. Rates convergence in the forex market towards securing an appropriate value for naira can no longer wait,” Adeosun said.

According to him, the new Minister must also implement a mix of fiscal policies to ease the inflationary trend as well as improve domestic productivity.

Adceosun urged the new minister, an astute investment banker, to mainstream the capital market as the fulcrum of the government’s reforms, noting that tapping the full potential of the Nigerian capital could help the government to achieve major reforms such as the revival of the local refineries.

Adeosun said: “The government should exhaust the capacity of the indigenous professionals, including lenders, before resorting to foreign interventions. We should also try to domesticate foreign expertise on projects execution whenever it is necessary.

“With the huge domestic and foreign debt overhang on the economy, the finance and economic team should develop and support the capital market and use it as the engine for driving its public-private partnership (PPP) initiatives.

“Capital Market democratises investment and wealth creating opportunities in the economy with securitization and gets more people and companies to benefit.”

The Chairman, Association of Securities Dealing Houses of Nigeria (ASHON), Mr Sam Onukwue, also emphasised the need to achieve a unified exchange rate regime. According to him, although there is no perfect unified exchange rate, it is practicable to have a situation where the margin between the official rate and that of parallel market is insignificant such as between one and three per cent.

“But the supply side of the forex must be addressed by the government. If otherwise, the exchange rate shall continue to hit the roof top. We at ASHON have always advocated the need for the government to tap into opportunities in the agriculture and commodities ecosystem to grow export trade and generate forex to boost economic development.

“Government could insist that commodities export trade should be conducted through approved exchanges to ensure the repatriation of export proceeds,” Onukwue said.

He added that the new minister must also prioritise reduction of interest rate significantly as the continuous hike in interest rate is a serious challenge to the economy.

He pointed out that appropriate tax reforms and other measures to reduce the cost of doing business in Nigeria will go a long way in creating the much-needed enabling environment for business to thrive.

He noted that in order to win investors’ confidence, a major task for the finance and economy, the government must create a conducive operating environment for business to thrive.

“The much-talked about but poorly implemented Ease of Doing Business should be vigorously pursued and sincerely implemented. Government should have a frank conversation with the organised private sector to truly understand their concerns,” Onukwue said. He outlined the need to leverage the potential of the capital market to bridge infrastructural gap.

“We have said it severally that this cannot be achieved through the normal budgetary process. The capital market option for raising long term fund for infrastructural development is always available to the government.

“The trajectory of development in Lagos State, for instance, is rooted in the use of the capital market opportunities.

“The Lagos State Government had over the years raised huge amount of money to develop the state economy. The federal government should take a cue and leverage domestic capacity before extending it to off-shore borrowing,” he said. (The Nation: Text, Excluding Headline)

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