NIGERIA has announced its intention to establish a $10bn diaspora investment fund, aiming to leverage remittances for domestic investments across various sectors, according to a tender document unveiled by the country’s industry and trade ministry.
The proposed fund aims to consolidate the billions of dollars remitted monthly by Nigerian citizens abroad, channelling these funds into local investments, particularly in infrastructure, healthcare, and education. Last year alone, Nigeria received an estimated $20bn in diaspora remittances, as reported by the World Bank.
In a public notice, Nigeria’s industry and trade ministry issued a call for ‘fund managers for the development and establishment of a multisectoral, multilateral private sector-led investment fund to form the $10bn Nigeria Diaspora Fund.’ The selected fund managers will be tasked with designing and implementing the fund, encompassing legal, operational, financial, and administrative frameworks.
The investment horizon for the fund is anticipated to span three to five years, with potential follow-on investments thereafter. The fund’s lifespan is projected at 10 years, extendable by an additional two years, as outlined by the government’s tender document.
Prospective fund managers are required to demonstrate a track record of business operations in Nigeria over the past five years, along with a proven ability to raise capital and manage large, profitable venture capital funds, according to the trade ministry tender.
Minister of Industry and Trade, Doris Anite, hailed the initiative as an ‘unprecedented opportunity for our citizens in the diaspora to drive Nigeria’s economic growth.’ The move comes amid challenges posed by foreign currency shortages, driven by reduced crude oil exports, which have exerted pressure on the Nigerian naira, prompting increased demand for dollars in the parallel market.
In addition to the diaspora investment fund, Nigeria plans to issue diaspora bonds later this year, aiming to further augment foreign exchange inflows into the country. These initiatives underscore Nigeria’s efforts to harness diaspora resources and external investment to bolster economic resilience and development.