ABUJA (Reuters) – The Nigerian central bank is seeking asset managers for a new $ 2.6 billion infrastructure investment company, which was set up to expand the country’s crumbling transportation networks and fuel economic growth.
The asset managers will create and manage infrastructure projects to generate a return on investments, the bank said on Saturday. The deadline for submitting proposals is March 16.
Nigeria emerged from the economic recession in the fourth quarter of 2020 despite a full-year decline. Growth is fragile, however, as poor infrastructure has hampered the economy for decades and stifles the distribution of wealth in Africa’s largest economy.
President Muhammadu Buhari approved the formation of the Infrastructure Corporation of Nigeria (InfraCorp) in February to focus on infrastructure development with seed capital of 1 trillion naira ($ 2.6 billion).
The starting capital will come from the central bank, the Nigerian Sovereign Investment Authority (NSIA) and the Africa Finance Corporation, the central bank said.
Economists say the poor state of Nigeria’s infrastructure has jeopardized the ambitions of the Buhari government to turn the country into a manufacturing center and expand the agricultural sector.
In 2017, the government established the Development Bank of Nigeria to provide loans to small businesses that make up almost half of the economy.
Now the government wants to fix its crumbling road and rail network, which has made it difficult to get agricultural and manufactured goods to market.
Buhari is committed to strengthening the agricultural sector, reducing Nigeria’s costly food imports, and diversifying the economy from an over-reliance on oil. However, access to long-term funds in local currency has been a major hurdle.
InfraCorp’s board of directors is led by the governor of the central bank, the executive director of the Nigerian sovereign wealth fund, the president of Africa Finance Corporation and three independent directors from the private sector.
The goal is for the company to grow to 15 trillion naira in terms of wealth and capital, according to the central bank.
($ 1 = 380.58 naira)
Reporting from Chijioke Ohuocha; Adaptation by Clelia Oziel