Nigeria plans to create a pioneering $10 billion diaspora fund to encourage investments from its large overseas population in vital sectors like infrastructure, healthcare, and education.
Afric Showbiz: Understand The initiative, led by Nigeria’s Ministry of Industry, Trade, and Investment, aims to leverage the economic potential of Nigeria’s diaspora community, which includes almost 20 million citizens globally.
The ministry announced on Thursday that it is seeking bids from investment managers to help set up the fund. The main goal of the fund is to enhance connections between Nigeria and its diaspora by utilizing the skills and financial capabilities of Nigerians abroad to drive national development.
The ministry stated, “The fund is part of broader efforts to strengthen ties between Nigeria and its diaspora, promote national development, and harness the potential of its citizens living abroad as agents of change and development for Nigeria.”
The ambitious decision is part of a set of economic changes introduced by President Bola Tinubu’s administration, which began in late May. These changes are designed to boost investor trust in Nigeria’s economy and stabilize the national currency, the naira, which has seen a notable decrease in value recently.
Some of the main reforms comprise relaxing foreign exchange controls, making it easier for international money transfers, and working to reduce the difference between the central bank’s policy rate and returns on short-term government securities.
– The World Bank estimates that Nigerians living abroad sent a substantial $20.1 billion in remittances in 2022.
– A significant portion of these remittances is channeled through informal channels such as the parallel market, bypassing the official foreign exchange market.
– This practice has led to a persistent shortage of dollars in official channels, resulting in currency volatility and depreciation of the naira.
– The proposed diaspora fund aims to offer various investment opportunities, including infrastructure projects, credit facilities, and venture capital initiatives.
– The ministry is encouraging interested firms, including joint ventures and greenfield funds, to submit their applications before the deadline on May 6.
The creation of the $10 billion diaspora fund marks a major achievement in Nigeria’s drive to gather resources for sustainable economic growth and development. Leveraging the knowledge and financial support of its diaspora, Nigeria seeks to encourage innovation, generate job prospects, and fortify vital sectors essential for lasting prosperity.
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