By Investadvocate
Lagos (INVESTADVOCATE)-Nigeria’s $1.55 billion sovereign wealth fund (SWF) had a “good year” on investments toward dollar assets, a Bloomberg report quoted Uche Orji, chief executive officer (CEO) ofNigerian Sovereign Investment Authority (NSIA).
“Our currency position was great as we were very long the dollar, it was the only game in town,” the report quoted Orji, CEO of NSIA.
According to Orji, the wealth fund set up in 2011 gained exposure to the dollar through equities, private equity and fixed-income assets. “The fund, which invests revenue generated when the oil price exceeds that budgeted by the government of Africa’s biggest crude producer, has adjusted to the market slump since June, he said.
The CEO of the NSIA affirmed that the budget was at $75 “and we all know where the oil price is now, so you don’t expect any contributions to the fund. We prepared ourselves for the impact,” he added.
Orji further affirmed that the authority’s private-equity investments were “very successful” last year. The NSIA’s mandate embraces a mix of stabilisation, savings and infrastructure funds, while outsourcing to a range of asset managers, including Goldman Sachs and UBS AG.
He disclosed that the Nigeria infrastructure fund, which has invested in toll roads and gas pipelines, has yet to allocate most of its $400 million.
The CEO at Nigeria’s wealth fund noted that his view on the European Central Bank (ECB) hasn’t changed while the ECB has commenced a 1.1 trillion-euro ($1.17 trillion) quantitative-easing program to help resuscitate the region’s sluggish economy.
Orji was quoted as saying “We will see whether there is the political will to sustain it. The political environment to make these things happen is a lot easier in the U.S. than anywhere else.”
He said Ngozi Okonjo-Iweala, Nigeria’s finance minister disclosed that last year the Nigerian federal government is targeting $5 billion for the wealth fund in the medium term.
The report quoted Orji as saying “You’ve got to able to look beyond these single events,” he said. “My No. 1 job is to keep these funds safe, and No. 2 is earn a return. Do I have the right asset allocation; do I have the right risk management in place? –- those are the things that keep me up at night.”
