The Federal Government has hinted about its plans to issue bond on the Vienna stock market to raise capital for investments in key sectors of the economy.
The Minister of Budget and Economic Planning, Sen,Abubakar Bagudu, made this disclosure on Tuesday while addressing through a video message the GPF Global Vienna Meeting in Austria.
A statement issued by the ministry on the minister’s participation at the meeting indicated that Bagudu confirmed that his ministry, the Federal Ministry of Finance and Austrian officials were collaborating with the Austrian Stock Exchange (ASE) and had established ESME Limited as a special purpose vehicle to fund investments in Nigeria.
According to him, the company will issue bonds on the Viennese stock market to finance investments by Austrian and other companies in green technology, waste-to-energy, textiles, pharmaceuticals, agriculture and water.
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The minister, who disclosed that ESME Limited had two representatives from the Ministry of Finance Incorporated (MOFI) and Austrian businessmen on its board, said the Federal Government was impressed by the progress made by the company towards the forthcoming bond issuance and expressed confidence that it would further strengthen the bilateral business relations between the two nations.
The ministry’s statement partly reads: “Bagudu argued that the successes of the economic reform were sufficient to incentivise Austrian investors, explaining that this was why his ministry, the Ministry of Finance, and Austrian officials collaborating with the Austrian Stock Exchange floated a company, ESME Limited, as a special purpose vehicle to fund investments in Nigeria.
“He stated that the company has two representatives from the Ministry of Finance Incorporated and distinguished Austrian businessmen on its board, explaining that the company would issue bonds on the Viennese Stock Market to fund investments by Austrian and other companies in green technology, waste-to-energy, textiles, pharmaceuticals, agriculture, and water in Nigeria, and to scale up”, it added.
The minister told the participants at the meeting that Nigeria’s ambition to become a $1 trillion economy by 2030 had increased the need to attract foreign capital, with the government identifying the Austrian stock market as a potential source of foreign investment.
The minister, who spoke on the theme “Financing Africa’s Future: The Vienna Stock Exchange as a Gateway to European Capital Markets for African Government Projects” urged Austrian investors to explore opportunities in Nigeria based on the country being “a proven market of choice with strong absorptive capacity, with over 200 million people. So, Austrian companies and businesses well-rooted in technology can operate profitably in Nigeria.”
Noting that Nigeria and Austria share similar demographics and comparative economic advantages that make the Austrian stock market attractive to Nigeria, the minister explained that the Federal Government’s economic reforms had improved the investment environment by seeking to achieve macroeconomic predictability and removing distortions, including in the foreign exchange market.
According to him, the reforms have provided a rule-based playing field for the capital market and improved investor confidence as the FX market has stabilised, with free entry and exit. Foreign reserves have risen significantly to over $50 billion, providing over 11 months of import cover.
The minister also spoke on the increased revenues across the three tiers of government as one of the gains from the current reforms, thereby providing the governments with greater opportunities to deliver services to citizens.
Bagudu assured prospective investors that they would not regret doing business in the country, as existing investors were earning more than 20% returns on their investments in US dollar terms.
