Sovereign Wealth Fund raises hope for second Niger Bridge, aviation, others
President Goodluck Jonathan has inaugurated the Council and Board of the Nigerian Sovereign Investment Authority (NSIA), otherwise known as Soverign Wealth Fund.
It is believed that with this inauguration, the provision of such critical infrastructure as the second Niger Bridge, Gurara Dam Phase 2, seaports and aircraft leasing company, would only be a matter of time.
At the inauguration in Abuja on Thursday , Jonathan canvassed support from contributors with a view to realising its set objectives for the benefit of Nigerians.
The occasion also witnessed the presentation of share certificates of contributions to the Sovereign Wealth Fund (SWF) to the 36 state governors, most of who were represented by their deputies. Also, certificates were issued to federal and local council officials.
The president said he was impressed by with the quality implementation of governance in the fund as well as the investment structure set up by the management team of NSIA, adding that the international community was already taking note of their efforts.
With the inauguration of the council, the president shall preside as its chairman. Other members are the 36 state governors, including the Minister of the Federal Capital Territory and Attorney General of the Federation.
Other members of the council are the Ministers of Finance and National Planning, Central Bank Governor, Chief Economic Adviser to the President, and Chairman of the Revenue Mobilisation Allocation and Fiscal Commission.
The 12 non-statutory members of the council whose nominations are subject to confirmation by the Senate, as stipulated by the Nigerian Sovereign Investment Authority establishment Act, will be appointed at a later date.
Jonathan, who was represented by Vice-President Namadi Sambo, pledged his support to assist the council discharge its responsibilities. He said it was expected that the governing council, which represents the broad ownership of the fund across all three tiers of government, would also provide guidance and direction to the board of NSIA.
'Sovereign wealth funds all over the world have been instrumental to fiscal discipline and development of the countries in which they exist.
'Our collective furnishing of the fund is reinforced by the presentation of certificates of contribution for federal, states and local governments, and I urge all Nigerians and officials at all levels of government to give their full support to the NSIA to ensure that its objectives are speedily realised for the benefit of all Nigerians.
'As you all know, these objectives include: building a saving base for future generations of Nigerians, enhancing the development of Nigeria’s infrastructure, and promoting fiscal stability for the country in terms of economic strength,' the president said.
He said he was happy that a number of other sovereign wealth funds and international investment institutions had already expressed their readiness to partner the NSIA in the execution of infrastructure projects in Nigeria.
'Given this, we should all be encouraged to remain steadfast in making contributions to the fund.
'While the initial $1 billion investment is not inconsequential and gives us credibility, the sustainability of our sovereign wealth fund depends on our continuous contributions.
'The NSIA makes investment with the expectations of profitable returns and in this vein, there has been significant progress in the stabilisation and future generation funds.
'The Authority is currently working hard to evaluate a number of infrastructure projects across the country. Some of the undertakings include the Second Niger Bridge, Gurara Dam Phase II, seaports investment, and an aircraft leasing company, to ease the financial burden in the airline industry and promote greater visibility in its operation.
'It is pertinent to say that the development of well conceived infrastructure projects by the NSIA will also provide a platform for our national pension funds to invest in credible undertakings.
'I urge the board and management team of NSIA to continue steadfastly in their role as custodians and administrators of our sovereign wealth fund.
'I also expect that they will always exhibit the greatest possible accountability and compliance with international best practices to gain and maintain the trust of all stakeholders in the fund, to assist and guide them in the discharge of their responsibilities,' Jonathan stressed.
Jonathan noted that the world over, SWF has been instrumental to the fiscal development of countries running them, so he called on government officials at all levels to ensure that the objectives of Nigeria's fund were achieved through their commitment and contributions.
He listed the objectives of NSIA to include: building a savings base for future generations, enhancing the development of infrastructure and promoting fiscal stability in times of economic stress.
He disclosed that a number of other sovereign wealth funds and international investment institutions have expressed readiness to partner the NSIA in the execution of infrastructure projects in Nigeria. However, he reiterated that while the initial $1 billion investment is not inconsequential, the fund's sustainability depends on continuous contributions.
The Nigeria Sovereign Investment Authority was set up to manage the Nigerian SWF, where all the surplus income from excess oil reserves is to be deposited. It kicked off with an initial deposit of $1 billion in seed capital contributed from the excess crude account.
The fund commenced operations in October 2012 with the objective of investing the savings gained on the difference between the budgeted and actual market prices for oil to earn returns that would benefit future generations.
According to Jonathan, the governing council, which represents the board's ownership of the fund across all three tiers of government, will also provide guidance and direction to the board of NSIA. And he stated: 'I assure you all of my support and cooperation as you begin to discharge this responsibility for the good of our people.'
The certificates were issued to the Minister of Finance, Mrs. Ngozi Okonjo-Iweala, who received them on behalf of the Federal Government, while the governors and Federal Capital Territory minister received on behalf of their domains and local councils.
Responding, the NSIA Chairman, Board of Directors, Mr. Mahey Rasheed, said the body, which kicked off in February, was now fully operational and has commenced investment activities, adding: 'We are evaluating a number of investment opportunities in the nation's infrastructure relating to transportation, power, healthcare and agriculture.'