Ministries Of Works, FCT Receive N130bn Sukuk Cheque

The federal government has presented two cheques of N130 billion raised from Sovereign Sukuk, a project-tied debt instrument to the Federal Ministry of Works and Housing and Federal Capital Territory Administration (FCTA) for the development of road infrastructure.

Minister of finance, budget and national planning Mrs Zainab Ahmed did the formal presentation of dummy Sovereign Sukuk cheques to the Ministers of Works and House, Babatunde Fashola and his FCT counterpart Muhammed Bello yesterday in Abuja.

The minister disclosed that Federal Ministry of Works and Housing got N110 billion, while Federal Capital Territory administration was given N20 billion of the Sukuk funds.

Mrs Ahmed said the 2022 Sovereign Sukuk of N130 billion will be released as part of the capital expenditure in the 2022 appropriation Act, which has been extended by the National Assembly to March 31, 2023. As at November 2022, N1.88 trillion had been released as Capital Expenditure, which represents about 40 per cent performance when compared to the total Capital Budget of N4.7 trillion.

Director-general of the Debt Management Office (DMO) said the present administration has invested the sum of N612.557 billion raised through Sovereign Sukuk between 2017 and 2021 for the construction and rehabilitation of key economic road projects in the six geo-political zones and the Federal Capital Territory (FCT).

She said the amount has been used to construct and rehabilitate sections of 71 road projects covering 2,808.06 kilometers and four bridges by the ministry of works and housing and sections of six road projects covering 99 kilometers and 19 bridges by the FCTA.

Oniha said through the Sovereign Sukuk initiative, the DMO has demonstrated its strong alignment with the policy of President Muhammadu Buhari on infrastructural development.

Aside the immense contributions of Sukuk to the funding of critical road infrastructure, Oniha said the instrument has also helped to deepen the capital market, created benchmarks for other borrowers and promoted financial inclusion by providing a retail product.

The private sector and sub-nationals have begun to embrace the instrument and I look forward to seeing more issuances in this regard as this will provide additional asset class for the rapidly growing ethical investors and funds in the economy.

In his remarks, Mr Fashola said the federal government is creating massive jobs in the construction sector by building roads and bridges. He said the new releases will help to also significantly address Nigeria’s poor roads network.

He said a vote for the ruling All Progressives Congress (APC) in the forthcoming general election will mean a continuation of infrastructure development in the country.