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FG plans investor roadshow to promote $2.8 billion Eurobond sale

09 Nov 2018, 06:32 pm
Financial Nigeria
FG plans investor roadshow to promote $2.8 billion Eurobond sale

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The fund from the international bond sale will be used to finance capital projects in the 2018 budget.

Nigerian Minister of Finance, Zainab Ahmed

Nigerian government officials will embark on an investors' roadshow to London next week to generate investor interest in the government's plan to raise $2.78 billion through international bond sale to fund its 2018 fiscal deficit. According to a report by Reuters on Thursday, the roadshow, which will hold on November 12-14, is being organised by Citi and Standard Chartered.

The Nigerian delegation will be led by the Finance Minister, Zainab Ahmed, who, in October, said that the Federal Executive Council (FEC) and the Senate had given approval for implentation of the external borrowing plan of N849.6 billion (equivalent to $2.786 billion), which is provided for in the 2018 Appropriation Act.

"And this is to fund capital projects in the 2018 budget," Ahmed had said shortly after a FEC meeting last month.  

The 2018 budget of N9.12 trillion, has a fiscal deficit of N1.95 trillion – part of which has been earmarked to be raised from the internal debt market. Nigeria's biggest Eurobond issuance ever was last year when the country raised $3 billion in a two-part international bond sale. The issue received $11 billion worth of bids, according to a report by Bloomberg.

The Senate also approved an external borrowing of $82.54 million to refinance the balance of $500 million matured Eurobond, which fell due on 12th of July, 2018. The approval was given in response to the letter by President Muhammadu Buhari, requesting the approval of the Senate to raise $2.78 billion from the international capital market for part-funding of the 2018 budget.

The president said the funding will be used to finance deficits and key infrastructure projects in the 2018 budget. The government had approved N2.9 trillion ($9.4 billion) for its capital expenditure this year.

Buhari's letter was approved by the Senate Committee on Local and Foreign Debts, following which its Chairman, Shehu Sani, presented its report to the Senate for approval. 

The Senate, however, advised the government to reduce its request for more external borrowing. Nigeria's public debt stock increased from N12.2 trillion as at June 30, 2015 to N22.4 trillion as at June 30, 2018, according to data provided by the Debt Management Office (DMO).


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