NSIA invests $500 million in domestic infrastructure projects in Nigeria

The Managing Director of the Nigeria Sovereign Investment Authority (NSIA), Aminu Umar Sadiq, has announced an investment of over $500 million in domestic infrastructure projects, affirming the Authority’s strategic focus on enhancing the country’s infrastructure and economic viability.

This announcement was made at the public unveiling of NSIA’s 2023 financial results in Abuja on Thursday.

During his presentation, Sadiq highlighted the pivotal role of the NSIA in bolstering the Nigerian economy, noting:

• “The NSIA’s impact on domestic investments has created real-time jobs and contributed to ease of doing business. Subsequently, by creating a more attractive investment environment, the NSIA is effectively leveraging its resources to attract significant additional capital for critical projects.
• “Already, the NSIA has made investments in over 50 per cent of locally owned and operated private equity funds. This targeted support strengthens the local financial ecosystem and empowers homegrown businesses to contribute to national development.”

He further acknowledged several global and local challenges impacting investment flows, including tightening global monetary policies, a slowdown in China’s economy, the 2023 United States banking crisis, Nigeria’s political transitions, and sustained high inflation levels. These factors play a critical role in shaping investment strategies and decisions at the NSIA as it navigates a complex global economic landscape.

Key Projects

• The NSIA MD also disclosed notable infrastructure projects that the NSIA has spearheaded throughout 2023. Among these significant initiatives is the 10MW Kano solar project, currently the largest grid-connected solar PV plant operational in Nigeria, which underscores the NSIA’s commitment to sustainable energy solutions.
• A key agreement with Varian on Oncology was also forged to enhance healthcare services across Nigeria, aiming to improve access to and delivery of cancer care. Additionally, the year saw the launch of two substantial financial instruments: the $202 million Medserve to support healthcare infrastructure and the $63 million Equilease aimed at bolstering equipment leasing.
• The infrastructure push continued with the commissioning of the pivotal 2NB and the AKK (Kaduna – Kano Section), both integral to enhancing Nigeria’s energy infrastructure. The NSIA ventured into environmentally focused investments with a $50 million carbon-vista joint venture with Vitol, targeting climate-aligned projects, thereby advancing Nigeria’s commitments to environmental sustainability.

Net assets reach $2.47 billion

Eleven years since its inception, the Nigeria Sovereign Investment Authority (NSIA), endowed with a seed capital of $1 billion (N156 billion) in 2013, has reported a remarkable 119% growth in net assets for 2023, reaching N2.22 trillion ($2.47 billion) up from N1.02 trillion ($2.27 billion) in 2022. This substantial growth was detailed by the NSIA Managing Director, Aminu Umar-Sadiq, reflecting the Authority’s successful management and strategic investment approaches.

The NSIA, Nigeria’s sovereign wealth fund, is structured with its capital distributed across three major funds: the Stabilisation Fund at 20% or $316 million, the Future Generation Fund constituting 30% or $1.06 billion, and the largest share, the Nigeria Infrastructure Fund, holding 50% or $1.102 billion.

Umar-Sadiq further highlighted the additional management responsibilities of the NSIA, overseeing significant third-party funds such as the Presidential Infrastructure Development Fund (N1.03 trillion), the Debt Management Office portfolio ($200 million), the Federal Government of Nigeria Stabilization Fund (N57.12 billion), the Nigerian Electricity Supply Industry fund (N200 billion), and the Presidential Fertiliser Initiative with net assets of N34.1 billion.

By the end of December 2023, the NSIA’s financial position was bolstered by net government contributions amounting to $1.646 billion since 2013, leading to a net asset value (NAV) of $2.47 billion at year-end, demonstrating an 8.5% annual growth in dollar terms.

In 2023, the NSIA received its inaugural royalty-by-price payment from the Nigeria Upstream Petroleum Regulatory Agency (NUPRC), amounting to $45.59 million, facilitated by the provisions of the Petroleum Industry Act.

The Authority’s total operating income for the fiscal year 2023 surged to an impressive N1.18 trillion, markedly up from N101.1 billion the previous year, buoyed significantly by foreign exchange gains.

Looking forward, following a robust performance in 2023, Umar-Sadiq outlined that infrastructure development and expanding subsidiary operations will be pivotal areas of focus for the NSIA in 2024 and beyond, aiming to continue this trajectory of growth and impactful investment.