The Securities and Exchange Commission (SEC), in its effort at expanding the depth of the Nigerian Capital Market and promoting financial inclusiveness through the Capital Market is organizing a High level Regional Roundtable Workshop on Non- interest Capital Market (Islamic Capital Market) with the Theme: Financing Development through Islamic Capital Market a Viable Alternative scheduled for Monday October 19, 2015.
This is in line with its strategic Ten year Master Plan on Non-Interest Capital Market. The objective of the workshop is to encourage states to explore the alternative model for financing infrastructure projects through Islamic Capital Market Products such as Sukuk.
Guests expected at the workshop include States Commissioners of Finance for Kano and Jigawa States, States Investment Companies, States Chambers of Commerce and Industries, Manufacturers Associations, SMEDAN, BUK Institute of Islamic Finance, Market Operators within the Region, Corporate Organizations and other Stakeholders.
Only last week, the Commission revealed that it is planning to grow non-interest capital market products to be 25 percent of the overall market capitalization. The disclosure was made by the Director General of SEC Mr Mounir Gwarzo in Abuja at a round table meeting with the Lord Mayor of London.
Mounir Gwarzo who was represented by Hon. Zakawanu Garuba, Executive Commissioner Corporate Services stated that “our goal is to boost non-interest capital market product innovation so that the segment can be at least a quarter (25%) of the overall market capitalization.
We intend to build a strong regulatory regime for non-interest products, encourage stakeholders in the non-interest capital market and ensure the emergence of Nigeria as a prominent non-interest capital market hub both at the regional level and globally. To harness this potential, proper planning is imperative.
That is why at the SEC we set up an industry-wide Committee of experts last year to produce a 10-year master plan on non-interest capital market product. Their recommendations have been incorporated into the broader capital market master plan which we have begun implementing.
There have been many successful examples of market development through implementation of master plans and we are confident that our own master plan objectives will be achieved as well over the next decade.
The SEC he said wants “to build a strong regulatory regime for non-interest products, encourage stakeholders in the non-interest capital market and ensure the emergence of Nigeria as a prominent non-interest capital market hub both at the regional level and globally.”
Mounir Gwarzo further stated that the SEC was considering modalities for setting up a Sharia Advisory Council as a body of experts to advice on non-interest product applications.
To boost liquidity of non-interest products the SEC he added is “working with a committee to support the FMDQ platform to enable secondary market trading of the products. We are also engaging the Central Bank of Nigeria (CBN) to obtain liquidity status for non-interest products (especially the sukuk).”
All these efforts he noted are hinged on the fact that “Nigeria has more than 80 million Muslims compared to Malaysia total population of 30 million. In addition, Nigeria has a larger economy than Malaysia, being the largest economy in Africa.”
To harness this potential, Mounir Gwarzo said proper planning was imperative which was “why at the SEC we set up an industry-wide Committee of experts last year to produce a 10-year master plan on non-interest capital market product. Their recommendations have been incorporated into the broader capital market master plan which we have begun implementing” he said.
In spite of the immense opportunity present in non-interest products, the SEC Director General lamented that Nigeria is faced with the challenge of lack of capacity.