Nigerian Government Unveils Plans for $10 Billion Diaspora Fund to Spur Investment

In a bid to galvanize investment from Nigerian citizens living abroad, the federal government has announced its intention to establish a $10 billion diaspora fund. 

Doris Uzoka-Anite, the Minister of Industry, Trade, and Investment, disclosed this initiative via a post on X, where she outlined the government’s call for bids from asset managers to set up the fund.

Exciting news! @TradeInvestNG invites firms to engage in the $10 Billion Nigeria Diaspora Fund Multi-Sectoral Investment. An unprecedented opportunity for our citizens in diaspora to drive Nigeria's economic growth. Partners interested in managing this transformative initiative… pic.twitter.com/YaJ3o3sCxj

— Hon (Dr) Doris Nkiruka Uzoka-Anite MD,CFA (@DrDorisAnite) April 25, 2024

The primary aim of the fund, as noted by Uzoka-Anite, is to provide support to critical sectors such as infrastructure, healthcare, and education, ultimately driving economic growth. She stressed that the fund will be overseen by an advisory board comprising limited partners, inviting eligible firms to express their interest in managing the fund.

“This fund is part of broader efforts to strengthen ties between Nigeria and its diaspora, promoting national development,” stated Uzoka-Anite, noting the pivotal role of diaspora engagement in advancing the nation’s socio-economic agenda.

She added: “Subject to the preferences indicated by fund managers, the fund will contain multiple investment platforms designed to offer investors different mechanisms for participating in Nigeria’s economic transformation.

“This fund is a way of encouraging remittances, attracting investments, and facilitating philanthropic endeavors aimed at supporting various sectors such as infrastructure, healthcare, education, and entrepreneurship in Nigeria.

“The launch of the diaspora fund will serve as an opportunity to raise interest in and awareness of the fund: towards mobilizing capital investment from the diaspora community.”

Elaborating on the objectives of the Nigeria Diaspora Fund, Uzoka-Anite explained that it will be managed by fund managers meeting specific criteria, focusing on various sectors and stages of investments. 

“The fund will be managed by Fund Managers that satisfy the criteria set out in the Expression Of Interest (EOI). The Fund manager will propose Fund structures that will focus on various sectors and stages of investments,” she said.

The fund is structured to offer multiple investment platforms, tailored to the preferences of diaspora investors, thereby facilitating their contributions to Nigeria’s economic transformation.

Furthermore, Uzoka-Anite outlined the investment parameters, highlighting that the fund will have an investment period of three to five years and a lifespan of ten years, extendable by two years. This framework provides diaspora investors with a substantial window to contribute to Nigeria’s socio-economic progress through sustained investment in key sectors.

The proposed asset offerings for the diaspora fund may include infrastructure, credit, and venture capital funds, presenting a diverse array of investment opportunities for diaspora investors. Interested firms, including joint ventures and greenfield funds, are encouraged to submit their applications by May 6 to participate in managing the fund.

“The launch of the diaspora fund is poised to raise awareness and mobilize capital investment from the diaspora community, marking a significant milestone in Nigeria’s journey towards sustainable economic prosperity,” she said.

This announcement aligns with the government’s broader strategy to leverage innovative financing mechanisms, including the issuance of domestic foreign currency-denominated bonds and a diaspora bond, aimed at boosting remittances and attracting investments from Nigerians in the diaspora. 

On April 3, the federal government announced its intention to commence issuing domestic foreign currency-denominated bonds starting from the second quarter (Q2) of 2024. Subsequently, on April 21, the federal government revealed plans to launch a diaspora bond as a means to enhance remittance inflows into the country.