The sole custodian of the Nigerian government’s investments and assets, the Ministry of Finance Incorporated (MOFI) says it’s leveraging strategic partnerships to enhance the drive toward the country’s economic transformation.
The Managing Director/Chief Executive of MOFI, Amstrong Takang, said on Monday the agency was determined to optimize value in its portfolio of government-owned investments and assets under its management to a minimum of N100 trillion over the next 10 years.
Takang spoke in Lagos during his working visit to the Nigerian Capital Market to meet with key members, including the Nigerian Exchange (NGX) Limited and stockbrokers, as part of strategic engagements to explore prospects of listing more government-owned companies and investments.
MOFI, which is the Special Purpose Investment and asset custodian Vehicle of the Federal Government, is a stakeholder of interests in all public companies, assets and investments on behalf of the government.
Takang said one of MOFI’s target objectives was to increase the economic impact of its portfolio companies by generating a minimum of $10bn in additional GDP by 2033, through strategic investments and partnerships to drive innovation, productivity, and competitiveness.
In a presentation at the NGX House in Lagos, the MOFI Chief disclosed that the agency was currently enumerating both the government-owned and government-linked assets in a national register to identify what really belongs to the government prior to plans to optimize value for national good.
To catalyze growth in priority sectors, namely agriculture, manufacturing, digital services, technology, real estate and healthcare, to support the development of high-potential
businesses in the nation’s economy, Takang said MOFI plans to establish at least five new sector-focused growth funds within the next five years.
“Our strategic pillars are to professionalize state ownership of public assets to drive superior returns; catalyze growth in priority sectors of the economy; finance the nation’s economy; source for funding and mobilize investments into government-owned and government-linked companies,” he said.
So far, the CEO told participants at the meeting that for a start MOFI’s portfolio of assets included control of at least 37 percent of the stake in 40 corporate entities so far enumerated valued at over N18.3 trillion, excluding the nation’s various mineral assets.
He said details of the portfolio of assets under its management span about 72 percent of the energy and extractive sector valued at about N14.32trn.; 16 percent of the financial services valued at about N2.57 trn.; 9 percent of the infrastructure sector valued at about N1.45 trn.; one percent of the services sector values at about N63bn, and 2 percent of the industrial sector valued at about N48bn.
“MOFI intends to collaborate with NGX to to identify government-owned entities that can be put on a path to listing in the capital market to help professionalize into meeting those governance, operating and reporting requirements for listing on the Exchange; present them with a platform to enhance their visibility to access to investment capital, and boost market capitalization,” the MD said.
Fielding questions from reporters, Takang said the national asset register would capture corporate assets such as solid minerals, oil and gas, concession assets, real estate, spectrum licenses, airports, seaports, and roads, and other intangible assets that could generate income for the government.
The partnership with capital market stakeholders, he pointed out, was designed to attract domestic resource mobilization, while drawing greater value from the various national assets currently idling away across the country.
The strategic meeting with capital market stakeholders, he noted was important, as it would afford the government the opportunity to source for capital for its various agencies, rather than continuing to fund their operations through the annual national budget.
“We need to utilize the capital market to raise money. We believe that by working with the capital market, the Chartered Institute of Stockbrokers (CIS) and the Association of Stockbroking Houses of Nigeria (ASHON), MOFI would be able to mobilize the needed investment capital,” he said.
Bringing government-owned entities to the capital market, he continued, would enable them to operate transparently and be subjected to market regulations, and in the process help MOFI achieve its aim of owning properly run companies.
Lamenting the proliferation of moribund state-owned companies that hardly delivered value in fulfillment of the purpose they were set up, Takang cited the example where a 30-year-old corporation in which the government invested $80mn each in capital and debt servicing has declined in value to just $5mn without any meaningful returns.
“MOFI needs to become a true custodian of government assets… We have to be active in asset management. (Going forward) before we spend government money, we must ensure there is an investment case. We have to set performance targets,” he stressed.
In his welcome remarks, the MD of NGX Limited, Temi Popoola, assured that governance and regulation have improved in the market as the cornerstone of the activities of all operators.
Popoola, who was accompanied by his three executive directors, commended MOFI for its role as the custodian of government investments and assets, saying the NGX was ready to partner with it to facilitate access to capital for listed government-owned entities to enhance their capacity to contribute to the advancement of Nigeria’s capital market.
“This partnership is an opportunity for the capital market to actively play a key role in growing the economy under the government development agenda. This is an exciting time for our local investors to really step up their participation in the market.
“With a lot of foreign capital, together with the strengthening and enhancements that have been done, the market is ready to support many initiatives from the government. We really look forward to working together to support the development of our markets,” he stressed.
Also speaking, the MD of NGX Regulation Limited, Tinu Awe, noted that the exchange is “very serious about regulation”, adding that members were ready to collaborate to ensure the market worked through the promotion of issues of transparency, investor protection and the need to mitigate risks.
