The Minister of Finance, Budget and National Planning, Zainab Ahmed, has confirmed the total assets under the Nigeria Sovereign Investment Authority (NSIA) management to be in the region of $4 billion.
Ahmed disclosed this on Friday, during the plenary on Sovereign Wealth Funds (SWFs) at the ongoing Africa Investment Forum (AIF – 2022) in Abidjan, Côte d’Ivoire.
Ahmed was quoted as saying that the NSIA has proven to be the Federal government’s partner of choice in the execution and successful delivery of significant infrastructure projects and transformational initiatives with national impact.
She said that the NSIA, which manages Nigeria’s SWF, launched its operations with $1 billion in seed money in 2012.
“But since its inception, the fund did not receive any additional capital till 2016/2017 when the Buhari administration came in. We were very quick to identify the importance of the NSIA in Nigeria’s development.
“Therefore, we focused on ensuring it gets funded, no matter how little, regardless of our fiscal challenges.
“Our administration has been gradually injecting money into the NSIA. At the end of 2021, NSIA’s core assets under management has now grown to $2.2 billion since the commencement of its operations and we have about $4 billion in total assets regardless of the many rainy days we went through recently. And the fund has been profitable consistently,” Ahmed said.
She noted that the Federal government is building key roads and bridges under the Presidential Infrastructure Development Fund through the NSIA.
“We have revived our fertiliser blending facilities through the supply of high quality NPK under the Presidential Fertiliser Initiative and are partnering with Morocco to build an Ammonia plant.
“We are supporting artisanal and small-scale miners while building up our reserves through the presidential artisanal gold mining initiative.
“We have also commenced our journey towards the adoption of clean energy starting off with the development of a 10mw Grid Solar Plant. We have constructed cancer and medical diagnostic centres across the country.
“We recently commissioned a state-of-the-art animal feed facility linked to hundreds of hectares of maize farms. We are tackling today’s problems head on. We allocated a certain proportion of NSIA’s funds for investments in innovative pioneer sectors within and outside Nigeria,” the minister said.
She stated that a sizeable percentage was invested in equities and bonds in Europe, America and Asia, adding that: “In today’s climate, this last fund is the one that is keeping me awake at night.”
Overall, the minister noted that successful African SWFs are those that strike a balance between meeting the local immediate needs such as infrastructure versus Nigeria’s long-term outlook for stability in periods of distress.
Ahmed stated that: “The next five years will be less dramatic and more predictable so we can plan properly for that rainy day, whatever it maybe.”
She recalled that when the discussion in Nigeria started about 10 years ago, right after the oil price crash of the late 2000s, Nigeria’s focus then was about stabilisation, as the country wanted to have something ‘safely tucked’ away to hedge against the cyclical volatility of being an oil economy.
According to her, the challenges for African SWFs would be the constant rain that Nigeria is experiencing and the decision on how to treat each wet day as it comes.
“We will gradually but sustainably build a fund for the future without ignoring today’s needs,” she said.
