Nigeria's securities regulator is pursuing a major overhaul of its capital market rules to position the country as an African financial hub and triple its size over the next decade. The Securities and Exchange Commission (SEC) announced a 10-year capital market development plan on Monday that targets expanding the market to N750 trillion (about $562 billion), increasing annual diaspora investment to $10 billion, and growing assets managed by collective investment funds tenfold to $56 billion.
Central to the strategy is a new African depositary-receipt framework designed to make it easier for companies across the continent to list in Nigeria. The SEC plans to introduce streamlined approvals, introductory listing-fee incentives, cross-border settlement and custody links, and tax neutrality as part of this framework. The regulator also intends to establish rules for foreign companies seeking Nigerian listings while creating pathways for Nigerian firms to list in other African jurisdictions.
The proposed reforms extend beyond cross-border listings. The SEC plans to modernise its listing rules by introducing free-float thresholds and permitting dual- and multi-class share structures. The regulator intends to benchmark issuance and listing costs against those in Kenya, South Africa, Egypt and Morocco, which it identifies as peer markets. A tiered listing and free-float regime is under consideration to establish different market segments with proportionate requirements, an approach the SEC says would allow founders to maintain company control while preserving market liquidity and investor protection.
The initiative follows recent momentum in regional capital markets. Five companies in the NGX All Share Index currently have cross-listings, including Airtel Africa Plc, Seplat Energy Plc, Oando Plc, Ecobank Transnational Inc. and Guaranty Trust Holding Company. Dangote Petroleum Refinery & Petrochemicals FZE is using global depositary receipts to market its initial public offering to a broader African investor base, with plans to raise as much as $2.1 billion in what has been described as the continent's biggest IPO.
For Nigerian savers, borrowers and businesses, these changes could expand investment opportunities and create new channels for companies to raise capital locally while accessing regional markets. The SEC's approach signals a broader effort to make Nigeria's capital market more accessible to businesses at different growth stages and strengthen its appeal to regional and international investors, though success will ultimately depend on whether the proposed incentives can deliver competitive liquidity, transaction costs and investor confidence compared with other African markets.