Nigeria’s 2019 general elections are here. Of utmost importance is the presidential election this Saturday, February 16th. As we speak, politically, men are being separated from boys because from the Independent National Electoral Commission, INEC’s list of over seventy presidential candidates to take part in the poll, real contest, as observers have seen is principally between sitting President Muhammadu Buhari of the All Progressive Congress, APC and former Vice President, Alhaji Atiku Abubakar of the People’s Democratic Party, PDP. As eligible voters file out this weekend to pick the candidate of their choice; Stockswatch went out to sample the opinions of stakeholders on how Atiku or Buhari’s election in the forthcoming 2019 general elections would affect the Nigeria capital market and by extension, the general economy.
IMMEDIATE STABILITY AND MARKET RECOVERY:
While it has been acknowledged by some that there are no clear differences between the two parties, it is believed that the incumbent, President Muhammadu Buhari, is likely to offer more stability in the short term, in the absence of aggressive policy reforms. Some market operators and watchers even believe that global institutional investors’ perceived stability in the nation’s economy if the incumbent President is returned is responsible for the improved activities in price performances of stock prices in the last one or two weeks.
On the other side, the major opposition candidate, Atiku Abubakar, a former vice president (1999 – 2007), is believed to be more tilted towards market driven reforms, which should drive economic activities in the country.
According to some financial and economic analysts, in reality, the economy is yet to recover from the 2016/2017 recession as it remains severely stressed, extremely fragile and vulnerable to external shocks.
OPINIONS:
Otunba Dele Ajayi Smith, Former Member: Lagos Chamber of Commerce & Industry, ‘‘the current Administration is doing a good job. We should understand that there are different types of revolutions. This government has started a revolution that will auger well both for the economy and the stock market.
During the time of Abacha, the dictator claimed to be leading a revolution, while at the time was busy stealing the country blind. Right up this moment, successive governments after him are still battling to recover the stupendous wealth he stole and took outside the shore of this country.
We are all living witnesses of the current revolution initiated by Buhari. Since his coming into office, he has embarked on the completion of numerous projects abandoned by successive administrations. His style of government is good and is already impacting the economy. What the current president is doing is good and would want it to continue.
On the other hand, what other parties are doing can be described as jamborees. They promise revolution, embark on looting of public treasury and wreck the economy.
Dele Sanusi, Stockbroker: APC will not bring anything new to the market because they have been in power and still remain there. The party will not be bringing anything new to the table as they would likely continue with the policies they started with.But Atiku’s election will usher in new economic policies which would likely impact the market positively. If there is any crisis post-election, the political risk will still remain, as investors will be apprehensive and would not want to be caught in the uncertainty that would ensure.
Seyi Idowu, Active stock trader and investor, ‘‘if Atiku wins, the market will go up. This is because the perception is that Atiku will be coming in with new ideas that could help the economy. However, many believe that Atiku will do better, the foreign investors would likely hold on to their money, unsure of what his new policies will turn out to be.
Mr. Arunah Kebira, Stockbroker and market Analyst: ‘‘If the person that loses in the next presidential election concedes defeat to the person that won, that political risk that has been hovering over the market and economy will be discounted and within a short period, the market will respond.
There will be a good market and it will touch every sector of the nation’s economy. Prices of stocks in the market have been beaten down to the level where they are, because of this political risk.
The market will now take it from there and start to consider fundamentals of equities. The equities’ prices can appreciate as much as by 2% to 3%. Investors will begin to consider companies that have good fundamentals.
On how the market will respond to who wins, if it is Buhari that won, the current president has ruled us for four years, we have seen what he can do, we can infer into what he will do. But if Atiku wins, people will respond to it more because he is an unknown force, because little is known of the economic programs that he might want to unleash. The international community will still be watching to know the calibre of people that will make up his cabinet. If he puts a ‘square peg in a square hole’ in his appointments to various ministries, the foreign investors will immediately respond to that and I think he would not want to make the same mistake that Mohammadu Buhari made by not constituting his cabinet on time. Even as he is campaigning now, he should have a list of individuals that will constitute his cabinet. He will immediately make public those to serve in his administration.
Boniface Okezie, Financial Analyst & Chairman Independent Shareholders Association of Nigeria: ‘‘We all know how the economy is, since Buhari came on as president. The economy has been running on rough edges, the stock market is down and the economy has not fared well. I think Atiku has what it takes to turn the economy around. He is an astute businessman.
He has the ability to put many Nigerians back on track by way of creating jobs for the youths, get micro-finance banks to give out more loans for start-up private businesses. He is a man that we all know has the pedigree as a successful businessman.
Mr. Ndata Samuel, a Stockbroker and doyen of the Nigerian Stock market, made the following comments: ‘If all accepts that the election was free and fair, no rigging, everybody will be happy for it. If Buhari wins, the market will quickly adjust, because we already know his track records on what he has been doing and method of his ruling. But if the election result comes out in favour of Atiku, the unknown will set in, as both local and foreign investors will adopt a wait-and-see attitude, until they are certain about the overall policy direction of the new administration. The market will not immediately move.’
Ibrahim Victor is the Chief Dealer at Zion Stockbrokers & Securities Ltd., he told our correspondent that ‘’as everyone already knows, the presidential contest is a straight fight between Atiku and incumbent president, Mohammadu Buhari. What will determine the political and economic situation in the country is the acceptance of defeat by the losing side. If Buhari wins, Nigeria is already progressing on the economic side and many investors will have more confidence. If Atiku wins, the private sector will come back, and the economy will be better than what we are experiencing now. For investors, there will be more inflow of foreign investment.’
Going by the assertions of all the respondents, it is clear that what the Nigeria’s equities’ market needs is a successful conclusion of the elections without crisis. Either way, Atiku or Buhari, the market looks ahead with hope.