THE JOURNEY TO ‘INTERNATIONALIZATION’ AND ‘DEMUTUALIZATION’: THE NIGERIAN STOCK EXCHANGE AND THE ACTING OF A SCRIPT, 1985 TO 2021

Abstract

In 1995, the Nigerian Stock Exchange was internationalized, which means that its trading platform was thrown open to the international community. With that development, it became possible for foreign companies to be listed on the Nigerian Stock Exchange (NSE). In May 2021, the NSE became fully demutualized. By demutualization is meant that the Exchange ceased to be mutually owned by a cooperative and became a public liability company, with power to sell its own shares to the general public and also regulate itself. The paper inquires into the journey that led to the adoption of these policies starting from 1985, when the Structural Adjustment Programme (SAP) was launched. It unravels the relationship between the two policies, their effects on the Nigerian economy and what propelled their implementation. The paper establishes that both are part of the continuous push towards the opening up of the Nigerian economy as recommended and propelled by the Breton Woods Institutions and other international agents of the West beginning with the SAP. The paper argues that the tenets of the SAP have continued to determine the path of Nigerian economic policies since the mid 1980s, and that the NSE have thus far been acting out of the SAP script faithfully by the implementation of the policies under review. The paper cautions that if the NSE does not act the script with wisdom and properly domesticate the policies by bringing in local inputs and considerations into the recommendation, it may be opening up the economy to only the rich few to the detriment of the poor majority. Primary and secondary sources of information relevant to the subject matter are used.