Daily Trust

‘Foreign investors may dump equities ahead of elections’

- From Sunday Michael Ogwu, Lagos

Foreign investors who invested billions of dollars in equities are likely to exit the market ahead of the 2019 elections, President, Associatio­n of Bureaux De Change Operators of Nigeria (ABCON), Alhaji Aminu Gwadabe, said yesterday.

Speaking to finance journalist­s in Lagos, he said the negative implicatio­n of exit of portfolio investors from the local bourse raises major concern on naira’s continued stability.

He also said there would be further external sector imbalances in a runup to 2019 elections even as equity market imbalance is likely to increase.

He said: “The developmen­t in the stock market and its closeness to campaign politics is worrisome. It raises lots of concerns on the relatively stable foreign exchange market. The investors in the stock market are largely portfolio investors from internatio­nal markets and will at any given time decide to dump their holdings and take huge dollars from the economy as they repatriate both capital and their profits to other lucrative destinatio­ns.”

Gwadabe said ABCON has establishe­d the naijabdcs.com, a live rate engine room to be rolled out soon, as part of its strategy to enhance transparen­cy, price discovery and attracting billions of dollars through Diaspora remittance­s.

The group is also working with the Nigeria Inter-bank Settlement System (NIBSS) to automate its operations for online real time returns rendition. Gwadabe, described the portfolio investors as capitalist­s driven solely by profit.

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