The Federal Government has concluded plans to launch and raise a $3 billion Eurobond from the International Capital Market (ICM) on October 11th, 2021, to boost infrastructural development across the country.
It said that the bond, in order to be oversubscribed and achieve its desired purpose, would be launched in Lagos, the country’s commercial capital, and in New York, the United States (US) for the dollar-denominated issuance.
It further hinted that efforts were been made to raise the same funds, $3 billion, through multilateral and bilateral borrowing to fund its 2021 budget which was already placed on a deficit.
The Eurobond, according to financial experts, is a debt instrument denominated in a country other than the home currency of the country in which it is issued.
The Minister of Finance, Budget, and National Planning, Zainab Ahmed, who announced the date for the Eurobond launch yesterday during a press briefing, stated that funds were needed to address the challenges confronting the country.
Ahmed noted that in other to avoid any face-off between the other arms of government, the Executive led by President Muhammadu Buhari, has approached the lawmakers and they have approved his financial plans for the country.
She announced the funds’ launch barely one month after the National Assembly approved the President’s request to secure both internal and external loans worth $6.183 (over N2 trillion).
“We have an approval in the 2021 budget to fund the budget deficit 50 percent locally and 50 percent externally. We are planning to do about half of that in Eurobonds and the other half through other windows such as multilateral and bilateral sources,” the minister added.
The moves to secure the loans were part of the strategies to boost the country’s growth after exiting its second recession since 2016 in the fourth quarter of last year within the shortest time ever.
The Nigerian Bureau of Statistics (NBS) had hinted that the nation was targeting Gross Domestic Product (GDP) growth that would be above 5 percent for 2021.
Nigeria’s economy grew by 5.01 percent in the second quarter of 2021, according to statistics released recently, as an easing of COVID-19 lockdown measures and an increase in vaccinations boosted commercial activities. However, persistently high inflation has dogged the nation.