The federal government has unveiled a strategic plan to harness the N20 trillion pension fund and other locally available resources for infrastructure development in Nigeria.

Wale Edun, coordinating minister for the economy and minister of finance, disclosed this at the end of the federal executive council (FEC) meeting chaired by President Bola Tinubu.

Edun said the government is focused on tapping into domestic financial resources, particularly pension and life insurance funds, to leverage local funds for national growth.

He added that it was a significant step towards driving economic progress and addressing critical infrastructure needs.

According to Edun, with over N20 trillion available funds within the country, there is a clear opportunity to channel these resources into vital sectors such as housing and long-term mortgage provision.

The minister said the move is part of the government’s efforts to bridge Nigeria’s estimated 20 million housing deficits and to provide massive housing and mortgage loans at 12 percent interest rates, with 25-year repayment plans.

“And the fact is that even before we start looking to foreign investors, we start looking to foreign funding, there is available in Nigeria, long term funds to fund infrastructure projects, and it’s within the pension, the life insurance and investment fund industry generally,” he said.

“There is upwards of N20 trillion available, and much of it is in short-term funding that doesn’t need to be. Pension money is long-term.

“People save over their lifetime for their pension. And so in conversation, in consultation, collaboration and cooperation with the private sector, we are now able to announce and with the full knowledge and support of all parties, that there will be an initiative to fund growth through investment in infrastructure, including housing, provision of mortgages, long term mortgages, 25-year mortgages at relatively low interest rates.

“Initially, of course, the government will stand back and provide some support, particularly in this era of high interest rates but eventually as interest rates come down, there should be less role for the government through providing, for example, guarantees and so forth.

“So, we can look forward to these huge funds being leveraged with the expertise, the ability, the capacity of the private sector, partnering with the government to drive economic growth.

“On the supply side, construction of houses will be funded. On the demand side, mortgages will be made available so that those constructing houses have an outlet and Nigerians who are saving so much by way of pension funds, have the added bonus of access to affordable mortgages.

“That really is the long and short of this initiative and you also as much as anybody else can understand and see what it means in the construction industry to do for the country. 

“That is the plan, that is the target that is the hope. And in this particular case, you have the best and the brightest that Nigeria has to offer, putting their minds together and committing to achieve their goals.”

TINUBU’S REFORMS ARE NECESSARY AND YIELDING RESULTS

Edun said Tinubu’s macroeconomic reforms are necessary and could not be delayed a moment longer.

According to the minister, the reforms are beginning to yield the desired results. 

“They were already delayed. Those reforms which are still in process, and which are beginning to give benefits in various areas, particularly in terms of trying to stabilise the economy, the exchange rate, bring inflation down, and eventually get interest rates down,” he said.

“But on the other hand, Mr. President has been consistent and he has also been commended, I must say, both around the world for for the fact that he is committed to intervening on behalf of the poor and the vulnerable in order to ease the pains of this necessary reform. But at the same time, given where we are in terms of stabilisation, it is time to focus on economic growth. 

“And one of the key drivers of economic growth is investment in infrastructure, in housing, power, rail, roads, water transport, even technology. These are key drivers of economic growth.

“They increase product. When you invest in them, you get increased productivity, you get economic growth, and you get job creation, which reduces poverty, and that is the strategy. 

“So, it’s two-pronged and we are not pivoting towards this all-important growth and you say where will the resources come from?”

The minister said the president approved the purchase of compressed natural gas (CNG) powered vehicles for the Nigeria Customs Service (NCS).

Edun also said about 600 CNG-powered buses and about 30,000 conversion kits will soon be made available to reduce transportation costs.