Legal Nigeria

Lagos plans tax incentives to boost capital development

By Amechi Ogbonna
Lagos State Governor, Mr. Akinwunmi Ambode, on Tuesday assured visiting UK-Nigeria Emerging Capital Market Taskforce of the readiness of his administration to provide tax and other fiscal incentives that will catalyse greater capital flows into the Nigerian capital market.
The Governor gave the assurance when he hosted the delegation of the UK-Nigeria Emerging Capital Market Taskforce led by a former Lord Mayor of the City of London, Sir Roger Gifford, and President of the Nigeria Stock Exchange (NSE), Mr. Aigboje AigImokhuede, who serve as co-chair of the taskforce.
Expressing optimism that the report on the state of the Nigerian capital market put together by the taskforce, will benefit Lagos and Nigeria on the long run, Ambode commended the team for embarking on an initiative, he said, has the potential of impacting the transformational development of the capital market.
He said it was not accidental that Lagos was the choice destination for the launch of the report since the state currently hosts the fifth largest economy in Africa. “Lagos State has an important role to play in this process, not just as the host of the key market platforms but as the largest issuers of sub-sovereign bonds in the Nigerian capital market.
“Even when you try to situate the level of bonds that we have taken and the level of growth and development that has taken place in Lagos, it’s very clear that the contribution of the capital market has been immense to us,” the Governor said.
He also said the capital market has the potential of empowering small and medium scale enterprises and larger companies with greater access to long term capital and introducing innovative financial products.
“We also want the economy of Lagos to expand and as we search to find a congress in cooperating together, we would be having more opportunities for younger Lagosians, people who are actually engaged in small and medium scale entrepreneurship to have more access to the capital market. This is something I look forward to,” he said.
Ambode also assured that his administration, aside creating an enabling environment for protecting investments, will also ensure an efficient judicial dispute resolution and arbitration system.
“I can commit myself to say that we would create an atmosphere where our judicial officers can actually sit down with capital market operators to find a channel to boost the objective of this project,” he said.
He further reiterated his administration’s commitment to working closely with the taskforce delivery group to look at the recommendations as it affects Lagos state and work towards implementing it.
Earlier, Sir Roger Gifford said one of the recommendations of the report, concluded in November 2014, aims at reducing the cost of capital market transactions and tightening the regulatory enforcement process, among others.
He said the report focused on four key areas including integrity of the market, regulatory infrastructure behind the market, market incentives and barriers as well as market development in the areas of derivatives and commodities.
“The report reviews and makes recommendations for reforms that would deepen the Nigerian capital market and attract both domestic and international institution player. This is essential to the benefit of Nigeria as we also hope it would be to the benefit of the international institutions.
“We see a win-win situation for all of us, particularly the Lagos State government and we want to continue that process now over the next six months up to a year where we build capacity, strengthen the regulatory environment and deepen the considerable business links that we have between London and Lagos,” Gifford said.
In his contribution, President of the NSE and co-chair of the taskforce, Aigboje AigImokhuede, said the collaboration with the UK authorities would lead to adoption of global best practices by the Nigerian market.
He said a recent MoU between the London Stock Exchange and the NSE would fast track other benefits that will boost capital flows into Nigeria.
-The Sun