Nigeria Sovereign Investment Authority
SWF: NSIA BOARD APPROVES INVESTMENT ALLOCATION FORMULA
• GOVERNANCE STRUCTURE RECEIVES INTERNATIONAL ENDORSEMENT FOR BEST PRACTICES
For its initial portfolio of investments, the Board of the NSIA has approved an investment allocation formula to the three Funds that make up the SWF - the Future Generations Fund, the Nigeria Infrastructure Fund and the Stabilization Fund.
According to the new guideline, the Future Generations Fund and the Nigeria Infrastructure Fund will each get 32.5% while the Stabilization Fund will receive 20%.
The remaining 15% will be kept as unallocated for now, and used to top up each of the ring-fenced funds, as opportunities arise.
This formula aims to balance the infrastructure need of the current generation and the need for the savings for the future generation of Nigerians.
Investment in the Stabilization Fund will start early June. The Future Generation Fund has the same timeline but will continue till end 2013 because it is a more diversified portfolio with a more complicated process.
For the Infrastructure Fund, a very detailed and thorough review of possible investment areas and projects is ongoing. The investments being considered are in healthcare, transportation, water resources, power, housing etc.
“Our focus is the on investments that are both relevant to the current needs of Nigerians and profitable and sustainable at the same time. We are ready to go anywhere to get the best deals for Nigeria”, says Mr. Uche Orji, MD/CEO of NISA.
The initiatives are coming at a time of strong indications that the Nigeria’s recently established sovereign wealth fund is receiving positive consideration from relevant international institutions and stakeholders.
The favorable signals include messages of support and interest in co-investment with the Nigeria Sovereign Investment Authority’s Infrastructure Fund from global firms and sovereign wealth funds of other countries.
Additionally, the governance structure of the NSIA has received strong endorsement from a cross section of participants who attended the just concluded Institutional Investors Roundtable of Global Sovereign Wealth Funds in Banff, Canada.
The participants at the event praised the governance structure for its fidelity to best practices and relevance to the peculiar challenges facing the Nigerian economy….. and commended the vision of MD/CEO, Mr Uche Orji.
In his reaction to these developments, Orji commended the vision of President Dr. Goodluck Jonathan for prioritizing the establishment of the NSIA and the leadership of the Coordinating Minister, Dr. Ngozi Okonjo-Iweala. He also praised the Board of Directors being led by Alhaji Mahey Rasheed for a strong leadership and guidance especially in this initial phase.
“The international support we have received is a reflection of the potential opportunity in Nigeria, the benefits of the NSIA, and the capability of the NSIA to be a catalyst for significant international investment. More importantly, our invitation to a group like this is a reflection of the credible governance of the NSIA and a commendation of the Federal Government’s vision”
Also, on April 21st, a high level team of the Nigeria Sovereign Investment Authority led by Chairman Alhaji Mahey Rasheed paid a courtesy call to the secretariat of the International Forum of Sovereign Wealth Funds (IFSWF), housed at the International Monetary Fund (IMF), in Washington DC to discuss the imminent membership of the NSIA.
The delegation also met with potential partners including a high level delegation of the world Bank, International Finance Corporation (IFC), US-Export Import Bank (EXIM) and US Overseas Private Investment Company (OPIC), as well as private sector players such as Goldman Sachs, Union Bank of Switzerland (UBS), JP Morgan, and Acumen Funds - a world class social infrastructure investment company.
These meetings are in keeping with a key mandate of the NSIA to serve as a channel to attract foreign investments into Nigeria and the discussions centered around NSIA’s pipeline of investment projects in Nigeria.
Via: Federal Ministry of Finance (FMF) Nigeria