How Can You Make Money From the New Government Policies?

Government policies are not just political news. Every tax change, new CBN rule, pension guideline, or import policy eventually affects your money. 

After the tough times in 2023 and 2024, the Nigerian economy looks a little calmer. Inflation has dropped, interest rates are high, and the naira is stronger. 

This new environment affects where smart investors should put their cash. Here are some major policy areas shaping investment opportunities today and how you can benefit from them.

Capital Gains Tax and Bond Taxes: Plan Your Moves

There are now more taxes on big profits from shares, especially when you sell large amounts within a short time. Interest from government bonds can also be taxed. This simply means what you see on paper is not always what enters your pocket.

What you can do:
• Split big share sales over different periods so you don’t cross high tax limits.
• If you have stocks that are not performing well, selling them can help reduce the taxable profit from the ones that did well.
• Compare the real return after tax before choosing between T-Bills, corporate papers, or government bonds.
• Consider mutual funds that are structured to reduce your tax burden and pay regular income.

More Government Borrowing: A Chance for Higher Returns

Government spending is still high, so more bonds are being issued. When supply rises, interest rates stay attractive, especially now that inflation is easing. This creates room for good returns today and possible capital gains later.

What you can do:
• Government auctions usually offer better prices, though you often need a big minimum amount.
• Divide your portfolio between short-term T-Bills and longer bonds to enjoy strong income now and potential gains in the future.
• Add some commercial papers from trusted companies if you want higher returns but can take a little more risk.

Insurance Recapitalization: New Strength, New Value

Insurance companies must raise more capital or merge to survive. In the short term, this can push prices down, but stronger companies will emerge with more capacity to grow.

What you can do:
• Focus on insurers that are already strong or have a clear and realistic recap plan.
• Look out for mergers and acquisitions, because companies that buy others often become more valuable over time.
• Be patient with dividends in the sector, because the real reward comes from long-term growth.

High Interest Rates and FX Confidence: Naira Investments Shine

The CBN is keeping rates high to protect the naira. With the currency stronger, naira investments are now looking more attractive than just holding dollars or Eurobonds.

What you can do:
• Increase your naira portfolio with T-Bills, FGN bonds, and top-rated corporate bonds.
• Still keep some foreign assets for balance, but let your strongest returns come from naira for now.
• Choose longer-term bonds if you believe inflation will continue to fall.

Pension Rules: Big Money Supporting the Stock Market

When pension regulators allow more money to enter the stock market, high-quality companies benefit the most. It boosts liquidity and investor confidence.

What you can do:
• Buy shares in strong, liquid companies with good leadership and steady earnings like top banks, telecom operators, and consumer goods firms.
• If picking individual stocks feels stressful, equity or balanced funds can give you similar exposure with less effort.

Import Policies: Local Players Have the Advantage

With restrictions on imports and limited FX access, companies that produce locally have better control of costs. Agro-linked and FMCG companies with local supply chains tend to perform well.

What you can do:
• Look at producers that grow or source their raw materials in Nigeria.
• Track companies investing in storage, logistics, and backward integration. These decisions usually boost profit margins later.
• Focus on businesses that gain market share when fewer goods are imported.