10 September 2015, Lagos – The continued fall in the prices of crude oil globally has stalled the Federal Government’s contribution to the country’s sovereign wealth fund.
The Managing Director/Chief Executive, Nigeria Sovereign Investment Authority, Mr. Uche Orji, disclosed this to State House correspondents on Wednesday after briefing President Muhammadu Buhari on the activities and the investments of the NSIA, just as he said that the preparatory stage for the Second Niger Bridge had gulped $2.2m.
He also said that the $1bn seed capital for the SWF contributed by the government recorded N15.7bn profit in 2014.
When asked if the authority had received additional fund outside the seed capital, he said, “Oil price is below benchmark. Because we are supposed to be funded when the oil price is above benchmark, it will not make any sense for the government to make any contribution now when the oil price is still low.
“But there are other ways to support the fund which we have discussed with the President. When the time is ripe, that will be made known by the President’s spokesperson.”
Speaking on the state of the fund, he said, “The government gave us $1bn which is the only contribution we have received and we made N15.7bn profit last year from the contribution. We haven’t got additional funds 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 fund remains the fund 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 can make that known.”
On the Second Niger Bridge, he said the authority had a vehicle called NSIA Motorways Investment Company that partners Julius Berger to become the preferred bidder in the bridge.
The NSIA boss said the authority was still going through the process of signing concessional agreement to become a concessionaire and to do all that was needed to prepare the project.