Federal Government Raises N1.092 Trillion from Six Sukuk Issues to Boost Infrastructure Development
The Federal Government of Nigeria has successfully garnered N1.092 trillion from six series of Sukuk, a Sharia-compliant financial instrument designed to attract ethical investment. The announcement was made by Ms. Patience Oniha, the Director-General of the Debt Management Office (DMO), during the All Parties Meeting for the Series VII Sovereign Sukuk held in Lagos.
Ms. Oniha reported that the funds generated from Sukuk have been directed towards the construction and rehabilitation of 4,100 kilometers of roads and nine bridges across Nigeria’s six geopolitical zones. The first Sovereign Sukuk was launched in September 2017, with an initial offering of N100 billion and a seven-year tenor. This inaugural series saw an enthusiastic response, achieving total subscriptions of N105.878 billion, signaling a strong positive reception.
Building on the success of the initial Sukuk, the DMO has raised a cumulative N1.092 trillion from 2017 to December 2023. The utilization of these funds has resulted in significant infrastructure improvements across the nation, benefiting various sectors and communities.
During her address, Ms. Oniha enumerated the advantages of these infrastructure projects, including:
- Reduction in travel time
- Enhanced road safety
- Creation of job opportunities
- Improved market accessibility for rural farmers
- Greater access to educational and healthcare facilities
- Contribution to overall economic growth
Furthermore, she pointed out that Sukuk promotes financial inclusion and is backed by tangible assets, thereby fostering the growth of Nigeria’s domestic financial market.
Looking ahead, Ms. Oniha revealed plans for the Federal Government to raise an additional N300 billion through the upcoming Series VII Sukuk. She assured that, as with preceding series, the funds raised will be allocated to capital projects throughout the country.
The meeting was attended by various stakeholders, including Transaction Advisers, Technical Advisers, Legal Advisers, Issuing Houses, and senior members of the DMO, emphasizing the collaborative effort in managing and supporting the Sukuk initiative.
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