Nigerian SEC and SON to enhance standards for Nigerian agricultural commodities

Nigeria’s Securities and Exchange Commission (SEC) partners with Standard Organisation of Nigeria (SON) to develop international standards for agricultural commodities, paving the way for increased exports and economic growth.

The Nigerian Securities and Exchange Commission (SEC) has announced a strategic partnership with the Standard Organisation of Nigeria (SON) to establish robust standards for Nigeria’s agricultural commodities, aimed at enhancing their acceptance in the global market and generating valuable foreign exchange (forex). Director-General of the SEC, Lamido Yuguda, emphasized the potential of the country’s agricultural sector to drive economic growth, create employment opportunities, and boost forex earnings.

SEC and CON – Overcoming historical standards

By focusing on standardization, Nigeria aims to overcome its historical challenges and position itself competitively in international trade, aligning with smaller African nations that have achieved better recognition and acceptance for their commodities.

Empowering Nigeria’s agricultural sector

Yuguda highlighted the significance of the agricultural sector’s imminent growth in Nigeria and the ongoing development of relevant standards through collaborative efforts. These standards are set to play a pivotal role in facilitating the export of agricultural products to international markets, thus contributing to the overall economic progress of the nation. Despite possessing abundant agricultural resources, Nigeria has struggled to match its peers’ performance in the global market due to inadequate standardization practices. The SEC commends the government’s commitment to supporting the commodities sector, recognizing the positive impact it will have on the SEC’s ongoing efforts to promote development in the sector.

Enhancing standardization to drive international recognition

The SEC has taken proactive measures to advance the implementation of the Capital Market Master Plan, including the establishment of a Technical Committee on Commodities Trading Ecosystem. This committee, in collaboration with stakeholders such as SON, has been tasked with identifying existing framework challenges and formulating a roadmap to foster a vibrant ecosystem. ““A committee comprising various stakeholders including the SON was set up to drive the implementation of the report. One of the recommendations in the report identified the development of grading and standardization system in line with international best practice,” said Yugunda.

Strengthening collaboration and encouraging listings

In line with its commitment to market development, the SEC has intensified its engagement with issuers to address pertinent issues and discourage frequent delisting from the capital market. To facilitate this dialogue, the commission has established the Securities Issuers Forum in collaboration with the Nigeria Employers Consultative Association (NECA). This platform allows the SEC to engage with NECA and discuss challenges faced by issuers, ultimately working towards finding sustainable solutions. “When issuers delist, they do because of certain issues. So we decided to engage NECA and set up the Securities Issuers Forum. This was done to sit and discuss the issues and find solutions to them,” Yugunda said.

Additionally, the SEC has introduced incentives to encourage more companies to list on the exchange, recognizing the substantial benefits that listing offers to both companies and investors. The commission aims to diversify the equities market by attracting listings from sectors such as power generation, telecommunications, and food, promoting a robust and diversified investment landscape.

Nigeria’s first privately-licensed commodities bourse, AFEX, is currently planning expansion into seven new markets.