From Uche Usim, Abuja
The Debt Management Office (DMO), on Tuesday, said it is set to issue another Sovereign Sukuk valued between N200-N250 billion, before the end of the year, to finance critical road projects across the country. Sukuk is an investment certificate that represents the ownership interest of the holder in an asset or pool of assets. The certificate entitles the holder to receive income from the use of the assets.
The DMO, which disclosed this in a statement, said it expects a high subscription level for the Sukuk when the offer opens. The Office commenced the issuance of Sukuk in September 2017 as a strategic initiative to support the development of infrastructure, promote financial inclusion and deepen the domestic securities market. Subsequent to the debut Sovereign Sukuk in 2017 in which N100 billion was raised to finance the rehabilitation and construction of 25 road projects across the six geopolitical zones, the DMO issued a Sukuk for N100 billion in 2018 and another for N162.557 billion in 2020. The proceeds of these two Sukuk issuances were also deployed to 28 and 44 road projects, also in the six geopolitical zones. In summary, a total of N362.577 billion Sovereign Sukuk was issued between September 2017 and June 2021.
Since the debut Sovereign Sukuk in September 2017 whose benefit in terms of improved road infrastructure within and outside cities in Nigeria is visible, the Sukuk has been commended as a viable instrument for financing infrastructure.