It has been revealed that the N612.56bn raised through Sovereign Sukuk between 2017 and 2021 has been spent. The Federal Government said it used the money for the construction and rehabilitation of 77 road projects and 23 bridges. The Minister of Finance, Budget and National Planning, Zainab Ahmed, on Monday at the symbolic cheque presentation ceremony of the 2022 Sovereign Sukuk Issue proceeds of N130bn to the Ministry of Works and Housing and the Federal Capital Territory Administration.
According to the minister, while 71 road projects and four bridges were under the purview of the Ministry of Works and Housing, six road projects and 19 bridges were handled by the FCTA.
She said, “As at date, this administration has invested the sum of N612.557bn 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.
“In real terms, the amount has been used to construct and rehabilitate sections of 71 road projects covering 2,808.06 kilometers and four bridges by the FMWH and sections of six road projects covering 99 kilometers and 19 bridges by the FCTA.”
She further disclosed that from the N130bn raised from the sukuk issued in 2022, the Ministry of Works and Housing got N110bn while FCTA got N20bn for road and bridge projects.
The finance minister said, “The FMWH and FCTA will be sharing the 2022 Sukuk Issue Proceeds of N130bn, which was successfully issued by the Debt Management Office on behalf of the Federal Government of Nigeria on December 02, 2022 as follows: Federal Ministry of Works and Housing – N110,000,000,000.00 and Federal Capital Territory Administration – N20,000,000,000.00.
“The 2022 Sovereign Sukuk of N130bn 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.”
She also noted that as of November 2022, N1.88tn had been released as Capital Expenditure, representing about 40 per cent performance when compared to the total Capital Budget of N4.7tn.
She then explained that this low capital expenditure performance led to the extension of the fiscal period to implement the capital component of the 2022 Budget. The Director-General, DMO, Patience Oniha, noted that the Sukuk can be issued to fund any fixed asset in the country as designated by the finance minister. She also noted that the debt office started issuing the Sukuk in a challenging environment, but the issue process became better over the years.
The Minister of Works and Housing, Babatunde Fashola, lauded the sukuk bond initiative, describing it as a bailout instrument that has helped in fixing Nigerian roads in the country. He noted that he inherited a sum of N18bn as total capital budget for roads in 2015 but the figure rose to about N266bn with the introduction of the Sukuk.
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