Financing the state government project through the capital market
has brought a lot of problem in our country and people are seeking a way to
solve the problems. Now the researcher want to find out the problems
encountered in financing the State government project through the capital
market and also how the capital market helps in financing the state government
Furthermore, the researcher will also find out the functions which
the capital market has performed in the funding of government projects.
All these point will help the researcher to carry out her work successfully.
1.2 RATIONALE OF THE
There have been serials of inefficiencies in financing the state
government project through the capital market. Hence the reason for this
i. To identify the problems facing state government.
ii. To find out possible solution of solving these
1.3 SIGNIFICANCE OF THE
The purpose of financing the state government project through the
capital market is to ensure the top priorities of the Nigeria government
project and the successiveness of the capital market.
Therefore this study will be a benefit to public and state government
i. Providing facilities for the quotation and ready
market ability of shares and stocks and opportunity and facility to raise fresh
capital in the market.
ii. To provide local opportunities to mobilize long
term capital for the long term purpose.
iii. Foreign business also benefit with the facility
to offer their shares and the Nigeria public on opportunity to invest and
participate in the share and ownership of foreign business.
1.4 BACKGROUND OF THE
The function of the state government in recent times includes the
provision of amenities and infrastructures which are capital intensive in
nature. Over the years most state governments especially in the
developing countries have been carrying out such functions with funds from
external sources as loans grants and development assistance or aids.
These resources have often been complemented with domestic resources as
statutory allocations from the federal accounts, internally generated funds and
However, events in the last few years have indicated the
inadequate of these sources. Nigerians experience in financing capital
projects has been similar to these of other developing countries with large
revenue from oil. Thus, with the down turn in the economy following
severe external stocks in the international oil market capital projects becomes
imperative, there has been a general shift of focus to the capital market in
financing government projects. This term paper attempts an examination of
the prospects and problems of financing state government project through the
Specifically, this term paper identifies the potentials for the
capital market financing facilities like Stadium, municipal market and
industrial housing estate amongst others.
1.5 DEFINITION OF THE
This refers to a collection of financial institutions set up for
the granting of medium and long-terms loans. It is a market for longer
term instruments which include market for government securities, market for
corporate bonds, market for corporate shares (stocks) and market for mortgage
These are issued by state or local government. They are
usually project tied and it is expected that the underlying projects should be
available enough that both the principal and the interest on the bonds will be
paid from the returns accruing to such projects. Examples of such
projects are water scheme market building, road and bridges and hospitals etc.
Consists of the following economic activity groups, mining and
quarrying, manufacturing, construction, electricity, gas, water and sanitary
These are facts organized or brought together by the researcher in
the course of his research work.
These are facts pulled by the researcher. These facts had
already been in existence. It could either be document or otherwise.
TERMS AND CONDITIONS APPLY
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