ABCON hails FG’s move to return JP Morgan to Nigeria

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The Association of Bureaux De Change Operators of Nigeria (ABCON) has praised the Federal Government’s plan to open talks with JPMorgan Chase & Co. on Nigeria’s return to the local-currency emerging-market bond index, saying the country’s reinstatement will bring great benefits to the economy.Its President, Alhaji Aminu Gwadabe, told newsmen in Lagos that JP Morgan Chase & Co. return to Nigerian market would lead to improved foreign exchange (forex) inflows and boost Central Bank of Nigeria’s (CBN’s) chances of achieving its $60 billion foreign reserves target in 2018 in spite of any shock arising from the oil prices.He praised the Federal Government’s plans to begin talks with JP Morgan about being included in its government bond index for emerging markets. Naira securities were removed from the JP Morgan Index in 2015 because of foreign-currency shortages.The ABCON boss said such return will also enable Nigeria benefit from the $20 billion overseas investment planned by the US bank which will see it raise wages, hire more, and open new branches in emerging market countries.Gwadabe said: “I want to use this opportunity to congratulate the CBN and the Federal Government on the good news of JP Morgan renewed interest on Nigerian bond market which will enhance investors’ confidence on our economy. The CBN has brought stability in the forex market by making dollar available to genuine forex users especially at the retail-end of the market. That has ended volatility in the market and boosted the confidence of foreign investors in the local economy”.He also praised the CBN for introducing the Investor’ and Exporters’ (I&E) Forex Window which has since April 2017 attracted over $27.8 billion in turnover into the economy and brought about transparency as well as stability in the forex market.The ABCON boss said the US Bank’s return to Nigeria will enable the government access needed funds for infrastructural developments in the economy and urged the CBN to explore the opportunity in reducing the multiple exchange rates and create more confidence for foreign investors. “It will create more opportunity for a genuine and transparent competition among forex operators and boost employment opportunities in the country as well as deepen the forex, naira and the equities markets,” Gwadabe said.The Federal Government is presently selling more foreign debt to help reduce the financing burden from paying double-digit yields on local-currency bonds. That would help free up funds to increase investment in infrastructure and spur economic growth. “We would like to get back into the JP Morgan Index,” Director-General of Debt Management Office (DMO) Ms. Patience Oniha said.Daily trading volumes for the naira have risen to about $200 million from as little as $20 million three years ago, according to Standard Chartered Plc. That bodes well for discussions on returning to the index, according to Oniha.

“The securities trading was never the problem, it was always the foreign-currency liquidity,” which has now improved, she said.Also, Finance Minister Kemi Adeosun said the government is focusing on improving its economy, and indexes will “naturally” return to Nigeria when they see adjustments in line with their requirements.“JPMorgan have their own framework of how they evaluate an economy, and when they are ready, when conditions are good, they will list Nigeria again,” Adeosun said.“We should just move in our own direction. What we need to do is to re-position this economy,” she said “JPMorgan or any other index will come naturally. My focus really is on the recovery of the economy. They will come when the macro fundamentals are right. They left because the macro fundamentals were not right,” Adeosun said.JP Morgan Chase & Co plans to expand its African presence into countries including Ghana and Kenya, Chief Executive Jamie Dimon said. “You will see us open in some countries we are not in, in Africa you will be hearing about some of that stuff,” Dimon said at the 2017 World Economic Forum meeting in Davos, Switzerland.

The Sun – Nigeria

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