The Federal Government commenced the search for fund managers for a planned $10 billion diaspora fund that is aimed at attracting dollar inflows and foreign investment into the economy.
Reuters reports that a tender document by Nigeria’s Ministry of Industry, Trade and Investment through a public notice indicated that the Federal Government was seeking “fund managers for the development and establishment of a multi-sectoral, multilateral private sector-led investment fund to form the $10 billion Nigeria Diaspora Fund.”
The fund seeks to pool together billions of dollars remitted monthly by its citizens oversees for local investments, including infrastructure, healthcare and education.
The tender document further reflected that the fund manager’s role involved designing and setting up the fund, including legal, operational, financial and administrative structures
According to the public notice, the expected investment period is for three to five years with follow on investment thereafter and the life of the fund will be 10 years and could be extended for a further two years
The ministry further clarified that prospective fund managers must have had verifiable business in Nigeria in the past five years, have a record of raising capital and managing large and profitable venture capital funds.
The Minister of Industry, Trade and Investment, Doris Uzoka-Anite, stated that it was an “unprecedented opportunity for our citizens in diaspora to drive Nigeria’s economic growth.”
Analysts observed that over the past two years, foreign currency shortages due to lower crude oil exports have put the local currency – Naira – under pressure, thereby compelling businesses and individuals to buy USD and other foreign currencies at the black market.
The Federal Government plans to issue diaspora bonds this year to further increased foreign exchange (FX) inflows into the country.
According to the World Bank, in 2023 Nigeria is estimated to have received in excess of $20 billion in diaspora remittances.
