The Federal Government is to utilise the country’s pension funds, loans from banks and Eurobonds to finance the development of its infrastructure, the Central Bank of Nigeria governor, Godwin Emefiele, has said.
Emefiele disclosed this aMEDt the Term Sheet agreement signed in Lagos 9between CBN and the infrastructure Corporation of Nigeria (InfraCorp) and the Independent Asset Managers to be involved in the development of the country’s infrastructure.
The CBN governor expressed joy that the partners have concluded the initial discussions on how they would operate together to deliver infrastructure to the country.
“Let me emphasise that today is a very important day. We have worked now for almost 18 months, trying to put this together.
“I am happy that we have reached the state where today we are signing the term sheets between infracorp and four assets managers.
The four Infrastructure Asset Managers include the AAA Consortium, Chapel Hill Denham, Africa Infrastructure Investment Managers here in Nigeria, and Sanlam Infraworks.
“The purpose of this is that in the first phase of this financing, we will raise N14 trillion debt, plus N1 trillion equity, which is being contributed by the CBN, AFC (African Finance Corporation) and NSIA (Nigerian Sovereign Investment Agency) upon signing the term sheets today.”
Emefiele said the signing of the agreement would mark the beginning of the peogramme, as parties would go straight into execution work, “because Nigeria very badly needs to develop its infrastructure.”
“There are infrastructure deficits in the public and private sectors, and we will like to be seen that we play our part at this time to support the efforts of the government and that of the private sector to see to whatever can be done to develop the infrastructure of Nigeria,” he said.
The CBN governor, who is also the chairman of the Board of InfraCorp, said the InfraCorp was opened for business and would be unveiled to Nigerians soon.
On the source of financing for the programme, Emefiele said apart from Nigeria’s pension funds, the banking industry would be ready to provide loans, while Eurobonds would also be issued and used to develop the infrastructure of the country as done in emerging countries.
“There’s a lot of liquidity that is being held by our pensions fund managers, I understand that from the last count that the size of Nigeria’s pension funds is over N13 trillion, and I’m told in another three to five years, Nigeria pension assets will rise to almost N25 trillion.
“In other countries where infrastructure corporations have worked, pension funds money have been used to develop infrastructure of those countries,” he said.
He said also that the first phase of the projects would kick
off in Lagos, Ibadan, Abuja, Kaduna and Kano and second Niger bridge.
The Chief Executive Officer of InfraCorp, Lazarus Angbazo, said the term embodies a set of relationships and the partnership that would exist between the infracorp and the assets managers.
“It is inclusive of the division of responsibilities, it clearly states what the rights and responsibilities of each party will be, and it defines the operatory between the infracorp and the asset managers as well as the governance structure by which we are going to execute the mandate of Mr President as nurtured by the promoters,” Angbazo said.
InfraCorp is a dedicated privately-managed infrastructure and industrial vehicle that will harness opportunities for Nigeria’s infrastructure development by originating, structuring, executing and managing end-to-end bankable projects in that space.(NAN)