The Director General of the Debt Management Office (DMO), Ms. Patience Oniha, disclosed that the agency is working on the possibilities of funding revenue generating projects to service funds raised via Sukuk.

Sukuk is a Sharia-compliant bond through which the Federal Government has raised about N362.6 billion used for road projects across the country.

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Oniha stated that the Sukuk initiative by DMO Nigeria had been increasingly successful due to the high level of awareness that has been created.

She said, “This success can also be attributed to the increased confidence from market participants given that the Sukuk bonds are tied to specific projects that can be tracked. Looking ahead, we recognise the need to upscale issuances to include other standalone projects beyond road infrastructure, but more importantly, we are looking to support projects that are revenue generating to service the Sukuk.
“Furthermore, there must be a focus on growing and diversifying the investor base for the Sukuk as well as other investment products.”

In his keynote address, the Chief Executive Officer, NGX, Mr. Temi Popoola said according to the Islamic Finance Development Report 2020, the Islamic finance industry’s assets grew by 14 per cent in 2019 to $2.88 trillion, returning to its long-term pattern of strong growth after the slowdown in 2018.

He added that. “Following the issuance of the first Sukuk in Sub-Saharan African – the Osun State N11.4 billion 7-year Ijarah Sukuk in 2013, the increasing demand for ethical investments in Nigeria has further led to three successful Sukuk issuances totalling N362.6 billion by the Debt Management Office on behalf of the federal government of Nigeria from 2018 till date; all of which were largely oversubscribed and have been listed on NGX.”

Popoola expressed NGX’s commitment to building this asset class, saying, the exchange would continue to provide an efficient and liquid market for investors and businesses in Africa, to save and access Shariah-compliant capital and investments.

He said, “Our collaboration with RedMoney in convening the annual IFN Nigeria forum attests to our belief in the potential and importance of Islamic finance in catalysing inclusive economic recovery and a more sustainable global economic growth.

“We will collaborate with all market stakeholders to contribute towards the growth of Islamic finance in Nigeria and Africa at large.”