The Debt Management Office (DMO) has announced that the Federal Government of Nigeria has successfully raised a total of N1.09 trillion through the Sovereign Sukuk since its debut in 2017.
The funds have been allocated toward critical infrastructure projects, including roads and bridges, across the country.
Speaking on Wednesday in Lagos during “an all-parties meeting” for the issuance of the seventh series of the Sovereign Sukuk, Director-General of the DMO, Patience Oniha, revealed that the latest series aims to raise approximately N300 billion to finance capital projects.
Reflecting on the progress achieved, Oniha stated, “We recall that the first Sukuk was issued in September 2017. After extensive marketing, the offer, which was for N100 billion with a tenor of seven years, received a total subscription of N105.878 billion.”
Oniha highlighted the accomplishments achieved over the years, noting, “Following the modest success of the first Sukuk and the achievement recorded from September 2017 to December 2023, the DMO has raised a total of N1.09 trillion.
With this amount, over 4,100 km of roads and nine bridges across Nigeria’s six geopolitical zones and the Federal Capital Territory have either been constructed or rehabilitated.”
Impact and Benefits of the Sukuk
The DMO emphasized the transformative impact of the infrastructure projects funded by the Sukuk. Benefits include reduced travel time, enhanced road safety, job creation, and improved market access for remote farmers.
Additionally, these projects have increased access to essential public services such as education and healthcare, further driving economic growth.
“In addition to those benefits, other reasons for the sustained issuance are the fact that the Sukuk is project-tied, promotes financial inclusion, and contributes to the development of the domestic financial market,” Oniha explained.
Oniha praised the widespread acceptance of the Sukuk, citing high subscription rates in past issuances.
What you should know
- She noted that investors experience dual benefits: the fulfillment of contributing to infrastructure development and receiving returns in the form of income paid semi-annually.
- The issuance of the Sovereign Sukuk is supported by financial advisers such as Lotus Financial Services Limited, Buraq Capital Limited, Stanbic IBTC Capital Limited, Greenwich Merchant Bank Limited, and Vetiva Capital Management Limited.
- These firms play a critical role by advising on the Sukuk’s structure, managing the offering process, and facilitating investor participation.
As the DMO prepares for the seventh series, the commitment to leveraging the Sukuk for sustainable infrastructure development remains strong, positioning the Federal Government to address key economic challenges and enhance Nigeria’s domestic financial market.
