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‘Electricity tariff removal will complete FG’s cost-reduction measures’

Group Managing Director, Afrinvest, Ike Chioke
Group Managing Director, Afrinvest, Ike Chioke

Investment expert and Group Managing Director of Afrinvest, Ike Chioke, said electricity tariff removal by the Federal Government will complete government’s cost- reduction measures.

Chioke said that although total removal of electricity tariff would further affect the current inflation statistics, the gains would be used to cushion the hardship of downtrodden Nigerians.

This disclosure was made during the mid-year investment meeting of Afrinvest in Lagos recently.

“There is still one subsidy element that the government needs to tackle, and that is electricity subsidy. We see that we will likely push from 23 per cent up to 24 per cent towards the end of the third quarter of the year before we can then see inflation being reined in. But most of these would depend on the policy of the new government,” Chioke said.

Chioke disclosed that some investors were still looking at the policy direction of the new administration.

“There is still a bit of upside but that upside momentum is with some investors sitting on the sidelines, waiting for the government to settle down, waiting for the FX policy. People don’t want to bring dollars to the market when they are not sure of the way out,” Chioke said.

On the expectations from the second half of the year, he said, though there was a lot volatility in the fixed income market, volatility is good if you are an active trader.

“In the equity market, we have seen a significant correction in the market. It is up by over 20 percent from when Presiding Tinubu came in but you have to be selective because there have been windows of profit-taking that put pressure on the market,” Chioke said.