NSIA urges FG to diversify economy

Uche Usim, Abuja

The Managing Director of the Nigerian Sovereign Authority (NSIA), Mr. Uche Orji, has advised the federal government to sell as much crude oil as possible and plough the proceeds into  non-oil areas of the economy.

This was even as he warned that the value of the black gold will be near-zero in the next two decades.

Speaking in Abuja on Monday, at the Nigerian Pilot Newspapers Leadership Forum, Orji said the country needs to deepen its investments in sectors including; agriculture, infrastructure, ICT, among others.

“By 2030, oil demand will be very low. Electric vehicles, excess production, solar, artificial intelligence and other new innovation will crash the demand for crude. This is the time to diversify the economy”, he said.

According to him, some countries’ Sovereign Wealth Fund are not reliant on crude oil, saying Nigeria should follow suit.

He said the authority, so far, has $1.75 billion as equity contribution to the SWF.

Orji said the investment pattern of the Authority is determined by its importance to the entire country, and the ability to attract handsome returns on investment and be able to attract co-investors. He listed focus areas to include; healthcare, agriculture, power, toll roads and gas industrialization.

We manage presidential infrastructure fund

“For us at NSIA, we’ve earmarked 50 per cent of the fund to infrastructure fund to address the years of infrastructure neglect. 20 per cent is for stabilization fund while 30 per cent goes to future generations fund.

The infrastructure fund aims to invest in domestic infrastructure projects that meet targeted financial returns and contribute to the development of essential infrastructure in order to stimulate the growth and diversification of the Nigerian economy, attract foreign investment and create jobs for Nigerians.

“Potential areas for investments include healthcare, transportation, energy and power, water resources and agriculture, amongst others.

“We invested $10 million in the LUTH cancer centre.  It’s part of our investments. It’s a PPP project that now treats 100 persons a day. But we want to expand that centre. “We’re fixing more equipment there so that we have 200 people treated there per day. We have 10 projects to deliver over time.

We have 25 fertilizer blending plants from the initial two we had when we began. This has collapsed the price of fertilizer from N13,000 per bag to N5,000. It uses mainly local components instead of imported raw materials. We are planning to establish ammonia production plant here in Nigeria since that is the major component of fertilizer.

“Gas flaring is harmful to the country and we are ending that as part of our gas industrialization blueprint.

The Authority may invest up to a maximum of 10 per cent of the funds in NIF in social infrastructure projects, which promote economic development in underserved sectors or regions in the country”, he explained.

On the future generations fund, Orji said the objective was to invest in a diversified portfolio of appropriate growth assets in order to provide future generations of Nigerians a solid savings base for such a time when the hydrocarbon reserves in Nigeria are exhausted.

“The FGF has a long investment time horizon of greater than 20 years, effectively spanning multiple economic and market cycles. This, coupled with the Fund’s payout requirements, allows management to gain exposure to certain asset classes that are less liquid and can therefore attain greater risk-adjusted returns”, he added.

He also said the authority was looking into acquiring the Nigerian House in New York to make it more commercially viable.

Earlier in his remarks, the Chairman and Publisher of the Nigerian Pilot Newspapers, Mr Dennis Sami said the leadership forum programme commenced close to 10 years ago to help top government officials unveil their programmes and policies before the media.

“At the forum, you talk about your ability, challenges, mandate and generally how to move the economy forward.

“We’ve hosted all kinds of people holding various positions. We’re celebrating 10 years in two weeks time”, he said.


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