NGX mulls dollar asset listing in capital market to ease FX woes

The Nigerian Exchange Ltd.(NGX) has proposed the inclusion of dollar-denominated bond listings on its platform to boost foreign currency access for businesses within Africa’s largest economy.

Temi Popoola, chief executive officer of the NGX, stated this recently, describing the initiative

as a potential solution to alleviate the foreign currency challenges faced by companies in Nigeria.

Popoola, in a report by Bloomberg, said the initiative has been proposed to the Nigerian government and has received positive interest.

Though the timeframe for the implementation was not disclosed, the initiative is expected to target companies generating revenue in foreign currency and those operating at the free trade zones.

The capital market authority is also proposing companies pay dividends in dollars. These initiatives,Popoola said, will improve the availability of foreign exchange in Nigeria and address the fluctuations in the forex market.

“Our primary objective is to enable these companies to issue bonds denominated in dollars and eventually offer equity in dollars as well. It could potentially address the challenges posed by fluctuations in foreign currency,” he said.

According to the NGX CEO, the foreign exchange issue in the country could drive companies to list abroad instead of Nigeria.

“If the target companies cannot access dollars within our market, many of them may opt to list abroad,” he warned.

Popoola expressed confidence on the possibility of the initiatives becoming a reality, stating that the stance of President Bola Tinubu in solving the forex market challenges gives confidence.

“Given the proactive stance of the current administration, it is reasonable to anticipate that these objectives can be achieved,” he noted