The Federal Government of Nigeria has appointed 23 fund managers to handle the $10 billion Nigeria Global Investment Fund (NGIF).
This ambitious fund intends to draw both foreign and local money into vital areas of the Nigerian economy, such as manufacturing, energy, infrastructure, fintech, and agriculture, according to a presentation document viewed by Nairametrics.
The Federal Ministry of Industry, Trade, and Investment founded the NGIF, which is a key part of Nigeria’s industrial revitalization plan, which aims to change the country’s economic structure by lessening its excessive reliance on oil earnings.
The fund is set up as an umbrella organisation that houses several smaller funds, each devoted to a particular industry that is essential to Nigeria’s progress.
55 applications for fund managers
The Securities Exchange Commission (SEC) oversaw a stringent review process that was followed in the selection of fund managers.
Based on factors like their knowledge of international investments, financial stability, experience managing public-sector partnerships, and adherence to Environmental, Social, and Governance (ESG) principles, 23 fund managers were selected from a pool of 55 submissions.
Prominent firms like AFC, Coronation Asset Management, Stanbic IBTC, AIICO Capital, FBNQuest Asset Management, and others are among the fund managers.
The NGIF is designed to hold 14 different sub-funds and 49 separate funds, and these fund managers will each be in charge of a particular sub-fund inside the fund.
The following priority sectors will be the focus of the NGIF’s 14 sub-funds: real estate, mining/solid minerals, aviation, infrastructure, education, IT, automotive/light manufacturing, agriculture, pharmaceuticals/healthcare, oil and gas, energy, fintech/banking, heavy industries, and heavy industries.
Raise an average of $500 million for each sub-fund to help reach the overall target of $10 billion for the NGIF’s first phase of fundraising.
Based on their knowledge and experience, the chosen fund managers are matched with these priority industries. For example, FBNQuest Asset Management and InfraCorp are concentrated on the infrastructure industry, whereas Greenwich Asset Management, Coronation Asset Management, and Meristem Wealth Management are associated with industries like real estate. In addition to raising money, each fund manager will see to it that investments are made deliberately to optimize their influence throughout these industries.
Afreximbank support
Development Finance Institutions (DFIs) like the African Export-Import Bank (Afreximbank) have provided substantial support to the government in addition to choosing fund managers. Afreximbank has pledged a $3 billion country risk guarantee to reduce the fund’s risk.
An extra $2 billion has been set aside for direct investments in important sectors of the economy. By providing project finance, equity investments, risk insurance, and advisory support, among other approaches, this funding will help initiatives get off the ground and accelerate the NGIF’s ability to spur economic transformation.
With $14.2 billion in yearly investment needed over the next ten years, Nigeria has a large infrastructure gap that the NGIF is expected to play a major part in filling.
The fund would target industries recognized as having the greatest potential for job creation and economic development by raising private finance.
This event is a component of Nigeria’s Renewed Hope Agenda, which outlines a larger plan to build a $1 trillion economy over the next ten years.
What to note
The Federal Ministry of Industry, Trade and Investment (FMITI) requested qualified businesses to express interest in serving as Nigeria Diaspora Fund managers in April 2024, according to a report by Nairametrics.
This was based on a statement posted on her X account by Doris Nkiruka Uzoka-Anite, Minister of Industry, Trade, and Investment.
The minister stated that these fund managers will be in charge of creating and establishing a $10 billion Nigeria Diaspora Fund—a multisectoral, multilateral investment fund managed by the private sector.
Additionally, it was claimed that the government has extended the application deadline for businesses hoping to manage the $10 billion Diaspora Fund. The deadline was rescheduled until May 13, 2024, from May 6.
