Nigerian stock market losing value by five percent– Ekekwe, investment advisor

Contrary to claims by the Presidency that the Nigerian stock market leads in value gains compared to more established markets, investment expert, Ndubuisi Ekekwe, a professor, has stated that the Nigerian Stock Exchange, loses in value by as much as  five percent considering that its gains are only in naira value.

Bayo Onanuga, special assistant to President Bola Tinubu on Media and Strategy, on his X handle, claimed that Nigeria’s stock market leads the world after a peer comparison of five year average growth.

In the comparison that feature five bourses, S&P 500, Shanghai SE, Johanennesburg SE, Ghana SE, Nairobi SE, and Nigeria’s NGX, the country recorded a 20.37 percent growth, on the average in five years.

But for the year 2023, it frog leaped to 45.90 percent.

Compared to the other stock exchanges, S&P 500 had 16.17 percent on five year average. But in 2023, it made a progress of 26.29 percent. The others rated as follows: Shanghai, 4.46 percent on five year average, -3.70 percent in 2023; Johannesboburg, 8.33 percent  on five year average, 5.26 percent in 2023. Ghana, 6.76 percent on five year average, but 28.08 percent in 2023; Nairobi -2.68 percent , and managed a  -10.44 percent.

Onanuga attributes the growth to eight month of his principal, Bola Tinubu, being in office.

But Ekekwe remarks on his X handle that that the gains in 2023 actually translates to a loss considering that the gains were made in naira. In real terms, Nigeria loses by five percent when considering currency devaluation.

Dollar currently sells for N1,385. It is higher with pounds sterling and Euro.

” The Nigeria stock exchange has been growing on absolute Naira, but on the real value, it is not.

“That statement is factual but the irony is that the growth, as noted by Bayo, has made many people poorer and depressed the overall value of the stock market.

“That is why foreign investors are not coming for that 45% gain because if you made 45% on equity, but lost 50% on currency, with 30% on inflation, you are poorer.

But he explained that the figures show that the ability to make more Naira in Nigeria has never diminished for years because there are opportunities.

“The issue is making the Naira under a stable currency.

“That way, if you are importing funds into Nigeria, you can win as shares of companies accelerate,” the expert said.

Ekekwe further added that the revelations show how rigged the Nigerian economy is.

“For all the pains people are going through, the fortunate few like most of us here are still logging a 45 percent increase in the stock market, with 20 percent on average over the last five years.

Ekekwe alongside HRH, Calipha Mohammed Sanusi, Ngozi Okonjo Iweala a currently on an advisory board to bring in foreign investment into Aba.

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