From Isaac Anumihe, Abuja
President Muhammadu Buhari has approved the re-engineering of Ministry of Finance Incorporated (MOFI) whose value has been put at
N30 trillion.
In her budget presentation, yesterday, in Abuja, the Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed, revealed that the process of restructuring has started.
According to her, the enterprise has N30 trillion in terms of assets size. So, the company can accommodate a debt of N10 trillion with assets of N30 trillion.
Meanwhile, MOFI has been existing for many years and has gradually become quite inefficient to the extent that it accumulated a debt of over N10 trillion.
“We started the process of re-engineering the Ministry of Finance Incorporated (MOFI), saddled with the responsibility of managing government assets.
MOFI has been existing since too many years ago and has gradually become quite inefficient.
So, we have got the president’s approval to start the process of re-engineering MOFI and we are now at the stage where we hope in the next one month or six weeks, we will be able to relaunch MOFI .
“We’ve been able to take stock of the assets that are in the books of MOFI and even without taking stock of the ones that are not in the books of MOFI, we have about N30 trillion in terms of assets size. So, if we are looking for a debt of N10 trillion, we already have assets of N30 trillion.
“We are going to open these assets for investments. So, we will issue different kinds of equities into these assets. The government doesn’t have the kind of resources to recapitalise these assets.
“When I talk about assets, I am talking about our investments like the Bank of Industry (BOI), the Development Bank of Nigeria (DBN), Galaxy backbone and several other agencies of government: Companies that government has set-up. A few of them are doing well and delivering the books but our assessment is what they’re doing can still be better by incremental adjustments.
“I give you an example. We’ve the railways in the books of MOFI at something like N20 million as the asset size and we are conducting a re-evaluation. By the time we finish the re-evaluation, the value of the Nigerian Railway Corporation will run into trillions. Also, by the time we finish the re-evaluation of our airports, it will run into trillions.
“There is a process that is on-going. We’ll have MOFI set up a world class investment company with a new management and a new board to move from the civil service structure where it sits as a unit under the Office of the Accountant General of the Federation, and get core professionals that are really focused and specialised in portfolio management and driving investments to run better.
“So, we expect to sway our assets to amend the books and show the real value. We hope to actually raise equity, to open up investment for Nigerians and non-Nigerians to invest in the assets” he said.
However, Ahmed revealed that the total ways and means is N20 trillion
and an approval has been granted for securitisation for a period of 40 years.
“The total ways and means today is 20 trillion and we have approval to securitize. The securitization will be over a 40-year period with interest rate of 9 per cent but over the years we have been paying the interest component at current rate that is charged on the Ways and Means” the minister noted.
Also, the government is considering a restructuring of National Youth Service Corps (NYSC) Act to make it possible for Nigerians in the diaspora to serve after three years.
NYSC Act provides that after three years, Nigerians outside the country will no longer serve but with the current development, Nigerians in diaspora can invest.
“The initial adjustment we are trying to achieve is for current diaspora Nigerians.
“The NYSC Act has a provision that says that you must serve within three years of graduation. So, we have people that are living in diaspora that go beyond these three years. The immediate past Director General of NYSC began a process that was indicating that they have gone against the law and actually wanted to take people up on that and our view is that, that is discouraging diasporans from coming back home and bringing investment” she said.