Yemisi Izuora/agency Report
The Securities and Exchange Commission (SEC) and the Debt Management Office (DMO) have inaugurated a committee for the nation’s first sovereign “Sukuk”.
Sukuk is an Islamic financial certificate, similar to a bond in Western finance that complies with the Islamic religious law, Sharia.
Mr Mounir Gwarzo, SEC Director-General, who confirmed the committee’s inauguration, said it would work out modalities for the Sukuk.
Gwarzo said that the committee comprising staff of the commission and DMO would set up modalities for the first sovereign bond.
He said that Sukuk had not been approved by the commission at the moment.
Gwarzo said that recently, the commission was working with the DMO to ensure issuance of the bond in the second quarter of 2016.
He stressed that the commission would support DMO in capacity building to ensure successful issuance of the bond.
Gwarzo said that the slide in crude oil price and drop in revenue generation made it imperative for government to source for alternative source of capital to finance infrastructure development.
“The need for alternative sources of capital to finance infrastructure becomes increasingly more compelling with fragility of growth from major emerging markets,’’ Gwarzo said.
He said the country would attract significant amounts of affordable capital from the Gulf countries and other established world issuing sovereign sukuk.
According to him, SEC and DMO will collaborate on ways to address the country’s investment needs.