Nigeria has set up critical legal frameworks that would enable the creation of a robust global financial market, and hopefully position the country to actualising the tall dream of an Africa’s financial hub mulled several years ago.
Three critical bills that would give a push to the project include the Nigerian International Financial Centre (NIFC) establishment bill; Financial Ombudsman Commission Bill, and a bill to enable the use of information in Electronic form for Conducting Transactions and for connected purposes, were passed at the last minute by the seventh National Assembly.
Nigeria’s dream of evolving an International Financial Centre (IFC) is the high point of the realisation of the Financial System Strategy (FSS) 2020, which seeks to make Nigeria the safest and fastest growing financial system among emerging economies.
Championed by the Central Bank of Nigeria (CBN) in collaboration with other key financial system regulators, FSS 2020 objectives include to strengthen the Nigerian domestic financial markets; enhance their integration with external financial markets, and engineer Nigeria’s evolution into an IFC.
Oluwatoyin Jokosenumi, head, programme management office, FSS 2020, describes NIFC as the platform for enhancing economic development, saying Nigeria has chosen the engineered model that is relevant for a developing country, especially in attracting external investments like the Dubai and Singapore experience.
“The benefits of an IFC abound. It would allow international players to come into the Nigeria market and help in development. The possible inflows are unimaginable if you look at the way Dubai was transformed and how financial centre catalysed the economy,” said Jokosenumi during a chat with BusinessDay.
The NIFC establishment bill seeks to facilitate the regional integration of West and Central African economies and accelerate Nigeria’s emergence as the regional hub for financial services.
It also promotes the demand for goods and services in the country and support the raw material needs/inputs for production.
The NIFC would be an integrated functional and full-service arena with focus on banking, insurance, capital markets, commodity trading and open to the best and biggest players in global finance and with a unique governance structure.
“The focus is to create an integrated economy for West and Central African nations where there are huge huge population and there is also opportunity, and Nigerian will eventually become the hub.
“There is also the direct exposure to create exchange programmes between the country and developed markets, but there is a critical constraint of raising the required fund, particularly in the face of low government revenues,” Jokosenumi, however, admitted.
The authorities believe that the NIFC would further attract local and international investors to establish operations.
When finally set up, the NIFC, considered as a quarantine environment, would warehouse three bodies – the Nigerian International Financial Centre Authority, the Nigerian International Financial Centre Regulatory Authority, and the Nigerian International Financial Judiciary Authority.
The proposed Financial Ombudsman Commission, also seen as critical to the financial hub project, would creates a platform for resolving disputes that might arise between stakeholders.
ONYINYE NWACHUKWU, Abuja
ONYINYE NWACHUKWU, Abuja