The Debt Management Office (DMO) has raised a total of N3.23 trillion from the domestic market to finance the 2022 federal government budget.
The Director-General (D_G) of the office, Ms. Patience Oniha, disclosed this, in Abuja, yesterday, while briefing the press on the N100 Sukuk now being offered to the Nigerian public for investment.
According to her, DMO has raised the sum of N612 billion through Sukuk, the ethical debt instrument since it was introduced in September, 2017 with all proceeds dedicated to road infrastructure.
She said, “We raised all of those monies for roads and bridges and there are signs around them so that Nigerians can see them and hold us accountable for the utilization of the proceeds.”
Ms. Oniha expressed satisfaction that the product has become widely accepted to the investing public, saying, “The first time we did sukuk, we had to undertake road shows to five states and held bilateral meetings to convince members of the public to invest in the product, but since then the instrument has become very acceptable to Nigerian public
“The fact that people can see the roads and bridges that are being constructed by Sukuk when they drive around has helped a lot. Sukuk has a product that is selling itself.
“We are happy to reach a lot more people to invest in the Sukuk. We have a lot of products that are available to all investors, local and foreign, including retail investors but Sukuk has the added advantage that it is financing infrastructure.
“We are driving retail investors and promoting financial inclusion, meaning those who have investible funds but having no securities that are acceptable for them to invest in find the Sukuk that product that they can invest in and earn some money.
“So overall, we are specifically borrowing to fund infrastructure and developing the market and giving people more investment opportunities.”
Why only N100 b .
The D-G noted that Nigerians were asking for the product but that her team put N100 billion on offer because it was already very close to its domestic borrowing limit of about N3. 5 trillion for the current fiscal year.
According to her, there has been a lot of excitement around Sukuk because the road infrastructure provided job opportunities and added value to the socio-economic development of the nation, describing it as a “win-win situation for all members of the public.
The N100 billion to be raised from the current exercise, she said would be applied to road infrastructure, under the Federal Ministry of Works and Housing and the Federal Capital Territory Administration.
Offer for the N100 billion Sukuk will close on Tuesday, next week
Ms. Oniha said, “Our focus is those people who ordinarily won’t invest either for reasons of ethics or they are not even aware that their money, though not big, can buy Sukuk. Or some who say, ‘I want to give my money to the government but I want to see what they are doing with my money.’ Sukuk is just the right product.”
She stated that funds borrowed from the capital market, at cheaper rates, earlier in the year had been very helpful in supporting the government in the implementation of the budget.
