The Federal Government’s contribution to the Sovereign Wealth Fund (SWF) has stalled due to crude oil price slump in the international market.
The Managing Director of Nigeria Sovereign Investment Authority (NSIA), Uche Orji, made the disclosure in Abuja on Wednesday after briefing President Muhammadu Buhari on the activities of the fund.
“Oil price is below benchmark and because we are supposed to be funded when the oil price is above benchmark, so it will not make any sense for the government to make any contribution now when the oil price is still low,” Orji explained.
He went further: “But there are other ways to support the fund which we have discussed with the President, but when the time is ripe that will be made known by the President’s spokesperson.”
On the state of the fund, he disclosed that the $1billion initial sovereign fund contributed by the government recorded N15.7 billion profit last year.
“The government gave us $1billion which is the only contribution we have received and we made N15.7billion profit last year from the contribution. We haven’t gotten additional fund from the government, but the fund is structured in a way that it can go through hard time.
“We all know that the oil price is volatile, it comes up and goes down but the fund is structured in such a way that it can remain continuously profitable.
“The funds come from the government and the profit made. We also discussed about potential infrastructure investments that can be made, but when the time is right the President will make that known.”
Orji also said he discussed the commitment of the NSIA on the second Niger Bridge, health care, agriculture and power with the President.
Stressing that the meeting was a successful one, he said: “Our commitment is that we have a vehicle called NSIA Motorways Investment Company that partners with Julius Berger investments to become the preferred bidder in the second Niger Bridge. We are still going through the process of signing concessional agreement to become a concessionaire and to do all of that we need to prepare the project.”
By Olisemeka Obeche