The Nigerian Sovereign Investment Authority (NSIA) has invested in the Construction Finance Warehouse Facility (CFWF), a partnership with InfraCredit, to mobilise up to N500 billion in funding for well-structured, bankable infrastructure projects.
The NSIA provided N10 billion as the initial funding for the CFWF, with the goal of attracting additional funding from other investors to reach a capacity of N100 billion within three years.
Chinua Azubike, CEO of InfraCredit said: “To close the infrastructure gap in a sustainable way, we need more greenfield infrastructure projects to reach financial close, we are pleased to be supported by our sponsor, the NSIA, in sustaining strategic innovative funding solutions at the earlier stages of the infrastructure project’s life cycle, which is a crucial and urgent intervention to make projects more resilient, and accelerate private sector investments in infrastructure that will improve Nigeria’s economic trajectory.”
According to the International Monetary Fund, Nigeria has a large infrastructure gap, and it will need to invest $100 billion annually over the next 30 years to close this gap.
Aminu Umar-Sadiq, managing director/CEO of NSIA, said, “NSIA, through the creation of InfraCredit, has successfully channelled long-term institutional funding towards brownfield infrastructure projects in Nigeria.”
The CFWF is a multi-funder revolving facility that was established to facilitate the provision of construction finance with a maturity of up to three years, for a portfolio of eligible greenfield infrastructure projects backed by InfraCredit’s guarantees on a direct or contingent basis.
This is as applicable, and to be subsequently refinanced through an InfraCredit-guaranteed long-term infrastructure debt financing from the domestic capital markets.
“The CFWF is set to amplify this capital mobilization, unlocking a source of long-term local currency capital for sustainable greenfield investments, in a downside-protective manner. This will significantly enhance access to sustained financing for green projects, consequently driving the development of sustainable infrastructure across Nigeria,” Umar-Sadiq said.