Director General, Debt Management Office, Mrs Patience Oniha, has stated that the N100bn gotten by Federal Government from Sukuk, would be spent on critical road infrastructure across the country.
“This is one of several efforts to raise funds for specific projects and this is backed by the full faith of the Federal Government. This is a rental product to cater for segments of our society that require such services”
Sukuk represents undivided shares in ownership of tangible assets, relating to particular projects or special investment activities, while bonds are securities in the form of a debt that will be paid back before a certain date in addition to interest.
Sukuk is structured in a way that generates returns to investors, without interest whereas bond is a debt investment in which an investor loans money to an entity, which borrows the funds for a defined period of time at a fixed interest rate.
Oniha alongside other officials of the Ministry of Power, Work and Housing assured potential investors that the Federal Government is fully in support of the Sukuk scheme.
Assistant Director, Planning and Development, Federal Ministry of Power, Works and Housing Mr Danlele Yila mentioned that the N100bn would be used to construct about 25 road projects and the dualization of some roads spread across the six geopolitical zones of Nigeria.
“This is a new product, which means new opportunities, new investment. I am confident that it will do well, same with other financial instruments such as the FGN Bond, savings bond and the others that the DMO has always put on offer”
According to the Debt Management Office, the benefits of investing in the Scheme comprises safety, regular and tax-free income, liquidity as it will be listed and traded on the Nigerian Stock Exchange and the FMDQ OTC Securities Exchange Plc.