The Nigeria Stock Exchange (NSE) recently experience sharp decline in market capitalization due to foreign investors exit from the market in apprehension of the impact of the decline in price of crude oil on the naira exchange rate.
Mr Oscar Onyema, CEO, NSE
Commenting on this development, some shareholders who spoke to Investors Forum described the foreign investors as casino players, who want to make money at the detriment of the economy, others attribute their action to fears of the outcome of the forthcoming election. Excerpts:
Alhaji Gbadebo Olatokunbo, shareholder activist: I will describe the foreign investors as casino players. I have been a stock market player for more than five years. They are not here for the interest of the market. They are here just to make money and if in the process of making money they harm our economy that is none of their business because we allowed it.
The stock brokers are happy because they enjoy turnover in terms of commission from the foreign investors. They tell them to buy this and sell that and get this, capitalizing on one aspect of the market to the detriment of the economy.
It will continue like that if we don’t change. Now that they are moving out, it is affecting the capital market and I hope steps will be taken to encourage genuine investors (that is domestic investors).
We have Nigerians all over the world that have billions of dollars but they don’t really trust people back home because when they send money to people in Nigeria to help them do something, instead of doing what they are asked them to do, they use the money for personal things. So, they are no longer disposed to sending money home for investment. They would rather give them pocket money.
All the things that are happening to us here do not happen abroad. It is because we don’t look inward to encourage our people to do the right thing for our economy.
We complain that foreign investors dominate our economy, once the money is going to the stockbrokers they care. It’s time the regulatory authorities, the NSE, SEC pay more attention to the local investors. If I don’t have the money it does not mean that few Nigerians abroad do not have the money. Coordinator, Greenwich Shareholders Association of Nigeria Mr. Williams Adebayo:
IT is certain that anything that affects politics affects the economy. They all go hand in hand, it is because of the upcoming election, the world is watching Nigeria, and their fear is how would the country conveniently hold the election. Your mind will be where your money is.
That is why the foreign investors are leaving but I want to assure that immediately after the election, if is peaceful they will rush back. There is no need for panic it goes together, politics and economic, they are interwoven. Imagine Nestle stock that is over N1000 before, it is now as low as 800.
It is not worth looking at the officia list of the NSE, because anybody who regularly monitor the system will realise it is because of our upcoming election. In spite of the brilliant performance recorded on these stocks you still find out that stocks are falling, it is because foreign investors are leaving.
That they should motivate civil servants by giving them soft loans to buy investments, equities so that the market would be spared the problem of sudden and massive exit of foreign investors. If most Nigerians invest in equities, we will not feel their absence any time because we have the population, but what we lack is awareness to sensitize people.
They are gamblers, fortune seeker. Like every trader, they want to make quick money, they want returns on their investment, they want to reap profit like any other businessman, but as they are concerned about making profit, they are also concerned about the safety of the investment.
This time is a very good opportunity for our local investors to buy if they have the money. Nestle gave interim dividend of N10 but it did not reflect, with that interim dividend the stock is supposed to rise by N170 or 150,.
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