Ava Global Asset Managers Limited has announced the issuance of N20 billion under its N200 billion Infrastructure Fund (IF) program aimed at bolstering infrastructural development within the country.
During a press briefing in Lagos, Mr. Efe Shaire, the Managing Director of Ava Global Asset Managers Limited, emphasized the importance of private sector involvement in infrastructure financing.
He stressed the necessity for collaborative efforts, innovative financial products, and other strategic initiatives from private sector entities.
Shaire urged private sector stakeholders to actively contribute to closing the infrastructural deficit in the country, aligning with government efforts.
His call to action comes amidst concerns highlighted in PwC’s Nigeria Economic Outlook 2024, which underscored uncertainties surrounding substantial governmental funding for addressing the prevalent infrastructural inadequacies.
Highlighting the significance of private sector support, Shaire pointed out that Ava Global Asset Managers Limited, as an asset management firm, is mobilizing funds through its Infrastructure Fund (IF) program to address this critical need.
Infrastructural deficits in Nigeria
He said the Ava IF seeks to address the infrastructural deficits in Nigeria through the objective provision of institutional capital into infrastructure development.
- “The overall objective of the AVA IF is to spur socio-economic impact and unlock the development of the Nigerian economy.
- The purpose of the fund is to serve as a new source of capital for infrastructure projects, promoting financing for infrastructure projects in Nigeria and the resulting socio-economic effects.
- The Fund is supported majorly by private sector monies and offers a sustainable platform for new kinds of investors that traditionally do not have access to these markets to invest billions in infrastructure projects,” he said.
Shaire disclosed that the fund, which is the first in the series, would close on March 6, 2024, noting that money raised would be invested in power, roads, agricultural processing, telecommunications, and other sectors.
According to him, Ava IF is a 10-year life cycle targeted towards infrastructure space for qualified investors.
He explained that before now, other operators had come up with the infrastructure funds driven by the changes in the pension industry, following changes in terms of new policies from PenCom, encouraging a lot of PFAs to invest in long-term infrastructure plans.
- “It’s at the back of these reforms that we thought that we also need to ensure that we can create instruments that pension funds and other institutional investors can as well invest in given the fact that they now have their new regulation,” he said.
Shaire stressed that infrastructural problems cannot be solved only by government initiatives, adding that the private sector should be able to also contribute to the conversation by working together to ensure cooperation with the public sector to accelerate the development of the infrastructure base while improving the country’s productivity.
- “Our country is almost a mono-product economy because of crude oil and there is no way we are going to move away from that and get foreign exchange from other sectors without making them productive and solving infrastructure problems. There is the need for private sector participation.,” he said.
The new administration’s pro-market policies
He noted that the new administration’s pro-market policies, including “partial” subsidy removal and FX market liberalization, have led to spiralling inflation and persistent Naira devaluation.
Shaire said that investors now face the challenge of protecting their portfolio’s real value against these tough macroeconomic realities.
According to him, the trend of benchmarking Naira portfolios against USD adds complexity, necessitating sophisticated currency hedging strategies in portfolio management.
