Nigeria’s Sovereign Wealth Fund Set for Fresh $250m Investment

Nigeria’s Sovereign Wealth Fund or the Nigerian Sovereign Investment Authority (NSIA) is set to receive fresh capital of up to $250 million after Governors of the country’s 36 states agreed to invest the said sum in the national investment vehicle.

The Managing Director of the fund Mr Uche Orji disclosed this recently.

The investment, according to reports, was made from the 2016 Nigerian Liquefied Natural Gas (NLNG) dividends that accrued to the states.

The NSIA is Nigeria’s Sovereign Wealth Fund (SWF), sovereign wealth fund, is a pool of money derived from a country’s reserves set aside for investment purposes to benefit a country’s citizens.

The States were reportedly keen to invest the NLNG proceeds after struggling in recent months to meet basic government responsibilities, owing workers months of salary and years of pension areas.

“Most of the states are largely dependent on FAAC allocations to fund their budgets. The drop in the oil price, lead to a huge fall in the allocations, leaving states owing pensions and salary arrears. The Federal government had to step in and provide bail-out funds. Investing in the NSIA, is thus a means of diversifying their revenue base,” read an analysis by Nairametrics.

Investments made by the NSIA, are unlikely to be concentrated in risky assets, and would be subject to stiff oversight. The fund has also made fantastic returns since its inception. Profit made by the NSIA jumped from N0.5 billion in 2013 to N11 billion in 2015. In 2016, the NSIA made net profits of N149.8 billion.

Source: Footprint to Africa

Leave a Reply