Nigeria’s government on Thursday said it will reinvest $250million into the Sovereign Wealth Fund upping its capital to allow for more investment.
This is to allow the Nigerian Sovereign Investment Authority increase its domestic infrastructure investment in 2017 as it plans to delve into affordable housing as well as healthcare.
The money will be drawn from the Federation Account, Finance Minister, Kemi Adeosun said on Thursday while briefing journalists after the National Economic Council meeting chaired by Acting President Yemi Osinbajo at the meeting which held at the council chambers of the Presidential Villa, Abuja.
This is even as the NEC asked the Central Bank Governor to review the current Foreign Exchange Policy in the country, especially the gap between interbank and parallel market rates.
Volatile oil prices had prevented the Federal Government from contributing to the Nigerian Sovereign Investment Authority (NSIA), after the initial deposit of $1billion in by the Goodluck Jonathan led administration in 2013. The seed capital was drawn from the nation’s excess crude account, with a commitment of continuous funding from both the states and federal government.
Adeosun told journalists that the decision to plough more money into the fund was made after the Nigeria Sovereign Investment Authority (NSIA) submitted its annual report for the year ended 2015 and 2016.
In its report presented by the Managing Director/Chief Executive Officer, Uche Orii the NSIA informed NEC of plans to increase domestic infrastructure investment in 2017 as there are compelling opportunities in the environment.
The NSIA also plans to focus on “Social Infrastructure” including investments in the form of affordable housing and healthcare throughthe development of specialist hospitals, Adeosun said.
The report also highlights, Financial performance 2014 to Q3 2016, Update and investment strategy on the NSIA Future Generation Fund (FGF), NSIA infrastructure strategy and Agriculture Fund, NSIA – Old Mutual Real Estate Co-Investment Vehicle, among others, NSIA outlook,
“Council while adopting the report of the NSIA decided to inject a fresh $250 million into the SWF sourced from the ECA” the finance minister said.
The council also approved board appointments into the NSIA, from each of the six geo-political zones.
They include Halima Buba for the North-East as Non Executive Director; Bello Maccido from the North West as Non Executive Director; Lois Laraba Machunga-Disu from the North Central as None Director; Babajide Zetilin from the South West as Non Executive Director; Urum
Kalu Eze from the South East as Non Executive Director; and Abue Ighodalo a legal practitioner from the South-South.
Council members unanimously adopted the nominations for onward consideration by the President for his final approval.
Briefing newsmen on the call by NEC for the review of the country’s exchange rates, after the meeting which lasted for about five hours, the Nasarawa State Governor Silas Agara, said NEC made the call after a presentation by the governor of the Central Bank of Nigeria, Godwin
Though FX supply has weakened, demand continues to soar in the largely import dependent economy. The naira further weakened further this week to N510/$ at the black market, but maintained the CBN partially controlled interbank rate to N315.
Analysts have said the management of foreign exchange in the country was hurting the economy, with an 11-year high inflation rate and a high rate of unemployment.
Reports had said despite allowing the devaluation of the naira in June, the CBN’s continued manipulation of the exchange rate had discouraging foreign investors, creating a shortage of dollars for businesses that need to import, and feeding a currency black market.
After a brief presentation on Forex Policy options by the CBN Governor, Council members generally expressed concern over the current situation of the exchange rate and called for an urgent review of the current Forex Policy, especially the gap between interbank and the parallel market rates, Agara said .
He said the CBN Governor sued for patience and understanding, assuring that the situation is being closely managed.
The Finance minister also reported to the Council that the balance in Excess Crude Account (ECA) stood at USD 2,458,382,844.03 as at February 15, 2017.
She also gave an update on the budget support loan facility stating that eight Accounting Firms have been appointed to start the verification process of the monthly Budget Support Loan Facility based on the approved Fiscal Sustainability Plan by the States.
The minister of Agricultural, Audu Ogbeh also briefed the council on the massive wheat production in the States of Jigawa, Kano, Kebbi and Zamfara among others.
“The States however appealed to the Federal Government to make plans for the purchase of excess wheat to ensure price stability and sustainable production.
Council agreed to discuss and make adequate buy-back arrangements in order to support price stability” Ogbeh said.