Gombe State last week made an ecstatic appearance at the capital market with a three-in-one programme aimed at significantly reengaging the private sector for the development of the state.
The state unveiled plans to raise about N30 billion from the capital market to invest in major infrastructural projects aimed at fostering sustainable development. The state has also launched a strategic private-public partnership drive to encourage private investments in key sectors of the state economy.
Gombe State Governor, Muhammadu Inuwa Yahaya, who outlined the state’s economic development blueprint at interactive sessions with capital market stakeholders and strategic investors at the Nigerian Exchange (NGX) in Lagos, said the state could raise funds through ordinary and alternative bond issuances. While the initial target is a N30 billion ordinary bond, the state could adopt a mixed issuance of ordinary bond and Sukuk, to meet the diverse demand of the investing public.
Gombe plans to float green bonds to fund many sustainable development projects. The northeastern state has budgeted about N120.7 billion for capital projects in the year, targeting infrastructural projects across key sectors of roads, healthcare and education among others.The admixture of green bond and Sukuk fits the geographical and geopolitical leanings of the state.
Under Nigeria’s green bond regulatory framework, a green bond is defined as any type of debt instrument, the proceeds of which would be exclusively applied to finance or re-finance in part or in full new and or existing projects that have positive environmental impact.
The rules indicated that green bonds would be used exclusively to finance renewable and sustainable energy, clean transportation, sustainable water management, climate change adaptation, energy efficiency, sustainable waste management, sustainable land use, biodiversity conservation and any other categories as may be approved by Nigeria’s apex capital market regulator, Securities and Exchange Commission (SEC), from time to time.
adaptation, energy efficiency, sustainable waste management, sustainable land use, biodiversity conservation and any other categories as may be approved by Nigeria’s apex capital market regulator, Securities and Exchange Commission (SEC), from time to time.
Inuwa explained that the green bond is aimed at raising funds for eco-friendly and environmentally friendly investments, especially in assets that will contribute to restoration and upliftment of human life so that the state can reduce the impact of climate change and global warming.
He said the state was building on its hugely successful private investment campaign, known as GoInvest 1.0, launched in 2022, with the roll out of GoInvest 2.0, which holds several investment opportunities for investors.
“With the support we saw and the acceptance by the Nigerian capital market stakeholders, we are going to hit our target,” Yahaya said.
He said the capital market is the ideal place for the governments and private sector to pool funds for development, assuring that Gombe State will continue to engage the market as strategic partner in its development programme.
He outlined that the state has several competitive advantages for investors, including being one of Nigeria’s most diverse and peaceful states, home to several multinationals, access to international markets, abundant natural resources, central location within the northeastern region, low-risk investment environment, skilled, young and available workforce, clear and large market potential for different goods and services and as a veritable emerging market.
He pointed out that Gombe has been ranked as the best state in Nigeria in the Ease of Doing Business (EoDB) for two consecutive years. It was ranked fifth out of 36 states under the fiscal transparency and integrity index. The index tracked accessibility, open budget, public procurement, human resources, anti-corruption and citizens’ engagement.
According to him, Gombe presents several investment opportunities, including tomatoes value chain and livestock.
He pointed out that the state has the largest grazing reserve in Nigeria with 146,000 hectares of land, comprising six veterinary clinics, milk collection centre and modern abattoir and 16 boreholes.
He said the government’s commitment to maintaining peace and fostering a business friendly environment has been a key factor in ensuring the state’s security and attractiveness to investors.
Experts agreed that the recourse to the capital market by Gombe holds several opportunities for the state and the sub-region.
Chairman, Nigerian Exchange Group (NGX Group) Plc, Dr. Umaru Kwairanga said underscored the importance of appropriate financing to unlock Nigeria’s vast potential across the states.
According to him, Nigeria is one of the best investment destinations globally as it is blessed with abundant human and natural resources.
“We have vast lands for agriculture and food production, almost every kind of mineral resources that you can think of, and a large hardworking populace,” Kwairanga said.
He commended the visionary leadership of Yahaya, noting that with a leader like him and an investor-friendly President Tinubu, the dream of inclusive development will become more realistic.
He said the next growth engine of the world is Africa and this is going to be led by Nigeria.
Managing Director, Backbone Connectivity Network Nigeria, Ibrahim Dikko, said the company was investing in Gombe because of the huge potential of the state.
“We have just signed an agreement with the Gombe State Government to position the state as a technology hub for Northeast Nigeria,” Dikko said.
Group Managing Director, GTI Capital Group, Mr. Abubakar Lawal, who was at the closing gong ceremony during which Yahaya emphasised the state’s readiness for private investors and beat the gong to signal close of the stock market for the day, said Gombe was an attractive destination for investors.
According to him, the state’s top rankings by many reputable institutions, including United Nation Development Programme (UNDP), Ease of Doing Business and Fiscal Transparency and Integrity Index and Council on Foreign Relations’ Nigeria Security Tracker among others are indicative of the impressive enabling environment.
Lawal assured that the capital market would support Gombe in realising its dreams of a vibrant and prosperous economy.
Experts said Yahaya, who doubles as the Chairman of Northern Governors Forum, could be the pathfinder for the region, which growth rate belies its huge potential. Gombe shares boundaries with Yobe, Borno, Adamawa, Taraba and Bauchi states, all with vast climate-related potential, including agro-energy projects.
Yahaya, whose state is credited as the most peaceful state in the country, has been commended for his leadership style and is seen as a leading influencer within the region.
Chief Executive Officer, Centre for the Promotion of Private Enterprise (CPPE), Dr. Muda Yusuf, said accessing the capital market by subnationals is a welcome idea.
“It could be helpful, especially for infrastructure projects. Not many states have the cash flow to fund infrastructure projects and complete in record time,” Yusuf said.
He, however, noted the need to ensure that the subnationals have the capacity to repay the debts and such repayment arrangement securely settled within the processes of the state governance.
With the Gombe State Investment Promotion Agency, which was established on December 22, 2023, expected to begin full operations this month, the state appears to be living up to its commitments to provide investors’ friendly environment. The agency will streamline processes for investor facilitation, including land acquisition, permits, licenses, and access to essential services with a view to supporting investors’ initiatives efficiently.
– Culled from a news analysis by Taofik Salako of The Nation Newspaper
