NSIA has evolved; we must adjust our scorecards accordingly

Referring to Ifeanyi Chukwu’s recent BusinessDay article, ‘Nigeria’s Sovereign Wealth Fund: Fattening Staff, Shrinking Gains’ (November 24), which critiques the Nigerian Sovereign Investment Authority’s (NSIA) Q1 2025 performance and seems to downplay its accomplishments, I would like to offer an alternative perspective.

The article, in summary, calls for a review of future capital infusions from the Federal Government on the basis of mismanagement and misaligned incentives – at one point juxtaposing a 34% increase in capital allocation to the sovereign wealth fund against Return on Assets (RoA) declining from c. 27% to 0.7% and increasing personnel costs (all Q1 2024 vs. Q1 2025).

Profitability metrics cannot be ignored but form only a part of the larger picture, which also includes balance sheet strength, asset allocation/development impact and governance/transparency. Despite increased personnel costs and decreased net income (both for the quarters ended March 2025 and 2024, not annual), NSIA has recorded 12 consecutive years of annual profits, culminating in a cumulative retained earnings position of c. N3.7tn as of FY2024. Net assets were also up a significant 96% to N4.4tn, having grown an even more material 119% in FY2023. Also worth noting is Global SWF’s (a data and research firm focusing on the global sovereign wealth fund market) own 2025 scoreboard, which shows NSIA at 100% (10/10 governance, 10/10 sustainability and 5/5 resilience), ranking the fund among a small global group with a perfect 2025 GSR score.

I believe focusing on short-term metrics as a barometer for the fund’s success is to misunderstand the role the NSIA plays in Nigeria’s economy today. In essence, the fund’s deeper, longer-term mandate requires a reconceptualisation of existing scorecards.

NSIA was founded in 2011 – primarily to protect Nigeria’s oil wealth by providing a sustainable savings base for future generations as well as a buffer against fiscal volatility. The objectives were capital preservation and steady returns (asset management mindset). Over time, however, NSIA has become more so an ecosystem builder as well as a physical and social infrastructure enabler, providing catalytic capital and expertise to further development of critical sectors (technology, sustainable power, healthcare, etc.). This shift isn’t arbitrary but rather a necessary response to an economy in dire need of development capital to fund infrastructure gaps and support a burgeoning tech ecosystem.

One example of NSIA’s role as an infrastructure enabler was the fund’s response to Nigeria’s gas flaring and commercialisation challenges: co-developing a $1.4bn ammonia plant (co-invested with OCP, Morocco) set to produce c. 1.5 MTPA of ammonia and 1 MTPA of NPK fertiliser post completion. Nigeria sits on one of the largest proven gas reserves in Africa, yet it flares volumes of c. 12 m³/bbl (more than twice the global average according to the World Bank), meaning billions of dollars’ worth of potential feedstock and export revenue is literally being burnt annually.

While NSIA’s fund architecture is largely unchanged since inception (Stabilisation Fund, Future Generations Fund and Nigeria Infrastructure Fund), the scale, complexity and number of programmes sitting under or alongside its funds have shifted significantly – with the inclusion of the Presidential Infrastructure Development Fund (2018), the Presidential Fertiliser Initiative (2016, now being transitioned to MOFI), the Distributed Renewable Energy (DRE) Nigeria Fund (March 2025) and others. These are more foundational/catalytic programmes with longer gestation periods and therefore require a longer-term outlook.

Read also: African sovereign wealth funds are becoming a force in capital mobilisation across the continent—NSIA CEO

Government funding is also not based strictly on financial metrics. Just as important are strategic outcomes such as the roll-out of oncology centres across the country or the Presidential Fertiliser Initiative, which has supported more than 80 fertiliser blending plants since inception – creating approximately 25,000 direct and indirect jobs as a result and supplying over 128 million bags of blended fertiliser to farmers nationwide. Consequently, NSIA appears to be delivering on its mandate to support closing of Nigeria’s infrastructure gap and catalyse economic stabilisation – key to this is whether such infrastructure and social investments continue to be reliably delivered in the future.

A clear, revised scorecard outline is essential to assessing fulfilment of NSIA’s mandate going forward. A longer-term view is required given the fund’s relatively unique physical infrastructure focus – by African and emerging market sovereign wealth fund standards at least – and ecosystem enabler status. My suggestions:

1. Catalytic impact: how much private capital has been mobilised for every public naira (or dollar) deployed. Important because it provides a view as to NSIA’s efficacy in unlocking broader investment

2. Strategic infrastructure outcomes: across different verticals such as digital infrastructure, healthcare, and agribusiness. Above financial returns, the ability to track real, measurable assets and services (e.g., data centre capacity, fibre footprint, etc.) highlights NSIA’s deep impact on Nigerian economic sustainability.

3. Financial sustainability and governance: a well-trodden path but worth keeping – not least because we are flying in this regard. Metrics such as deployment timeline transparency and any others that speak to fund discipline

4. Economic transformation metrics: GDP contribution of target sectors, job creation, revenue diversification, etc.

Worth also noting – while we’re here – the importance of increasing focus on digital infrastructure over the coming years. A strong digital backbone is a multiplier for the tech ecosystem as well as agribusiness (data provision in trading and logistics), healthcare, education and many more. Reliable connectivity is pivotal for a rapidly digitising economy looking to leapfrog infrastructure barriers and unlock efficiencies in trade. NSIA’s role in the development of a 57 MW data centre in Lagos State (its pioneer investment in the tech sector) demonstrates the fund’s acknowledgement of the part cloud solutions and other digital services workloads will play in the economy over the medium to long term. Mobilising private and foreign co-investors toward scaling fibre and network infrastructure would be a welcome follow-up to an already strong start as a major enabler in this space.

NSIA has become a national strategic platform, playing the roles of investor, convenor and market shaper. The continued evolution of the fund could see further involvement in even more critical spaces (major digital corridors, regional innovation hubs and stronger health and education infrastructure) through deployment of government funding and mobilisation of strategic, long-term, third-party capital. At this stage, I would argue for the acceleration of follow-on funding to meet this growing mandate with ongoing monitoring of appropriate evaluation metrics.

Finally, NSIA is now as much a development engine as it is a portfolio fund. Our evaluation metrics must adjust accordingly.

Samuel Adeleke Adelaja: Head, Partnerships at Airtel Business Africa; Investment Director at Airtel Africa.

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