Nigeria is proposing sweeping reforms to integrate West Africa’s fragmented capital markets to unlock long-term funding for infrastructure. Finance Minister Taiwo Oyedele made the proposal on Tuesday, November 10, at the S&P Global Ratings Africa Summit in Lagos, saying no single market in the region is deep enough to attract the scale of patient capital needed for growth.
At the core of the plan is a regional “passport” regime that will allow issuers approved in one country to raise capital across other West African markets without seeking separate approvals. Nigeria is also pushing for a unified investor ID system, so investors registered in Lagos can buy bonds and equities in Ghana and eight francophone countries without repeating KYC onboarding.
The reform will cover 10 countries: Nigeria, Ghana, Benin, Burkina Faso, Ivory Coast, Guinea-Bissau, Mali, Niger, Senegal and Togo. Oyedele said the plan builds on existing initiatives like the West African Capital Markets Integration Council, the African Exchanges Linkage Project and the Pan-African Payment and Settlement System (PAPSS).
Other proposals include a regional local-currency bond index and a credit enhancement facility for cross-border infrastructure.The push comes as Nigeria’s economy shows uneven recovery. Inflation eased to 14.63% in September from 20.98% last year, GDP grew 4.43% in Q2, and external reserves hit $55.25 billion. Yet the Federal Government is seeking $7.7 billion in external borrowing to finance a N31.4 trillion deficit.
If approved by regional regulators, the reforms could lower borrowing costs and expand access to long-term naira bonds for Nigerian manufacturers and SMEs who currently struggle to get credit. Nigeria is targeting a $1 trillion capital market and investment-grade rating within three years under its 10-year market plan.
Sources: Reuters Africa,CNBC Africa, THEWILL