Mr Godwin Emefiele, Governor, Central Bank of Nigeria (CBN) has reported that the board of the Infrastructure Corporation, its Managing Director and four Asset Managers have been appointed.
Emefiele told journalists at the end of the two-day annual bankers’ committee retreat on Wednesday in Lagos that the decision to appoint four Asset Managers was to hurriedly reduce the level of infrastructure deficit in the country.
President Muhammadu Buhari had earlier in the year, given approval for the establishment of the N15 trillion Infrastructure Company (Infraco Plc), a world-class infrastructure development vehicle exclusively focused on Nigeria.
“In 2022, the bankers committee will be focusing on supporting the Central Bank and the government in developing the infrastructure of the country, reducing the level of infrastructure deficit in a country realizing that there is increasingly limited fiscal space to fund capital projects, particularly infrastructure projects.
“ I am sure you all know that the President gave approval for the establishment of infrastructure Corporation of Nigeria early in the year.
“As we stand, the Board of the Infrastructure Corporation has been constituted, the Managing Director of the company has been appointed, and four Asset Managers have been appointed.
“Normally what you will find is that in such kind of infrastructural project you will have just one asset manager; but we decided to appoint four asset managers because we feel that we are in a hurry.
“And that once an asset is allocated to an asset manager, he goes with his project; you can have at least four simultaneous projects going on at the same time,’’ Emefiele said.
The apex bank governor also disclosed that the Infraco Plc was already working on three major infrastructural projects in the country.
“As we speak, the Infrastructure Cooperation is already working on three major infrastructure projects in the country-The Abuja-Kano road, the second Niger bridge and the Lagos Ibadan Express Road.
“The Federal Government approached us to provide some kind of bridge funding; the bridge funding is almost about N170 billion and we provided it so that those projects can move on with funding.
“The entire scope of those three projects I am told is slightly above N1 trillion; but the numbers are being worked on. And I believe by the time the asset managers effectively come on board, the details of those projects and the remaining aspects of those funding would be coming in through debt and that is where the asset managers would come in with the entire scope and then we would know the detailed cost of those three projects,” Emefiele explained.
The apex bank governor stressed that the N1 trillion of the N15 trillion equity is being contributed by CBN, African Finance Corporation, Nigerian Sovereign Investment Authority (NSIA) adding that the remaining N14 trillion would be accessed from debt market.
According to him, we are happy here that these are substantially going to be naira funding.
He said, “The banks have a large pool of funds, the pension administrators have a large pool of funds and we are reasonably optimistic that more than 50 per cent or two-third of this money is going to be raised locally.
“Before we begin to think about accessing international finance, we would try as much as possible to limit debt for foreign currencies particularly knowing that some of these projects and revenues are going to be generated with local currency. Where foreign currencies are needed, we will also take those and then be able to use them,” he said.
Emefiele admitted that within the Nigerian financial system, there’s a lot of idle capital that can be channeled to INFRACO as it was set up to give comfort to investors especially the local investors to put their funds in these projects.
“This is a brilliant alternative financing methodology that has been brought up and we seek to really look into this. It intends to help government and private sector to raise finance, without necessarily encumbering the balance sheet of the Federal Government,” he said.
On issues of export, Emefiele said that the bankers’ committee agreed to aggressively encourage and support exporters.
“We listened to some exporters who lamented the problems they go through in conducting their export activities and the bankers committee is saying that one way that we can deepen Foreign Exchange revenue in the country is for us to encourage and aggressively support exporters.
“It is not just about providing them with finance which we are committed to, but also the fact that we should do everything possible and the CBN is engaging the various agencies of the government to see what we can do to make it easy for people to conduct their export activities,” he said.