STABILISATION FUND INVESTMENT POLICY STATEMENT

A Policy governs investments in the Stabilisation Fund to maintain a liquid reserve for federal budget support during revenue shortfalls. It targets the NSIA investment team and federal financial bodies, ensuring fiscal stability through high-liquidity assets.

What Is This Policy?

The investment policy governing the NSIA's Stabilisation Fund, which is maintained as a liquid buffer to support the federal budget during periods of significant revenue shortfall.

Who Does It Target?

NSIA investment management team Federal Ministry of Finance as custodian of fiscal policy National Economic Council External fund managers for liquid asset classes

What Does It Aim to Achieve?

Maintain a readily accessible pool of liquid assets that can be drawn down to stabilise the federal budget when oil revenues fall significantly below budget projections.

Key Features

High Liquidity Focus: Portfolio emphasises highly liquid, investment-grade fixed income assets that can be liquidated quickly when needed. Capital Preservation: Primary investment objective is preservation of capital rather than high returns. Short Duration: Maintains short-duration investments to ensure rapid access to funds without significant market value risk. Drawdown Rules: Defines the conditions and approval process under which funds may be drawn from the Stabilisation Fund.

Current Status

Rollout Stage: Active Coverage: Federal fiscal stabilisation Beneficiaries: Nigerian public through budget stability; public servants and contractors Funding: NSIA from excess crude revenues

How to Access

Drawdown requires National Economic Council approval Fund is not accessible for general public investment Application method: Not applicable - institutionally managed.

Important Terms

Stabilisation Fund was drawn upon during the 2016 and 2020 economic shocks Drawdowns must be replenished when revenues recover Fund balance is publicly reported in NSIA annual reports

Official Resources

Website: https://www.nsia.com.ng Contact: Nigeria Sovereign Investment Authority (NSIA)

Legal Framework

Issued under the investment mandate of the Nigeria Sovereign Investment Authority (NSIA) pursuant to the Nigeria Sovereign Investment Authority (Establishment, etc.) Act 2011. The NSIA Act is the principal statute governing the three-fund structure. Operates alongside the Fiscal Responsibility Act 2007, the Debt Management Office Act, and the CBN Act. Aligns with IMF and World Bank guidelines on sovereign wealth fund management and the Santiago Principles on SWF governance.