Federal Government Set To Borrow $2.5bn To Meet 2017 Budget Deficit

The Federal Government has stepped up its aggressive borrowing measures as Debt Management Office, DMO, indicated that it would be raising additional USD2.5 billion (about N917 billion) through a fresh Eurobond offer in November 2017

Director-General of DMO, Patience Oniha, made this known at the 2017 edition of Nigerian Debt Capital Markets Conference and Awards, organised by the FMDQ OTC Securities Exchange in Lagos, Thursday.

Oniha said the borrowing would enable the country bridge funding gap in the 2017 budget.

She said the proposed Eurobond issuance would complement the USD1.5 billion raised from the international market in March 2017, adding that the nation’s Treasury Bills portfolio currently stood at N3.7 trillion, adding that DMO planned to refinance it with foreign borrowing to reduce pressure on the domestic market.

Sukuk Bond borrowing

On the N100 billion Sukuk Bond, Oniha said the Federal Government had identified 25 road projects to be funded with the proceeds.

The roads, according to her, include Ore-Sagamu Road, Kaduna Bypass, Enugu-Port-Harcourt Road, Kano-Maiduguri and Benin-Lokoja Road, among others.

Oniha said the acceptance of the Sukuk Bond offer was an indication of the viability of the instrument as an investment option, as well as a demonstration of utmost faith in the economy. The seven-year Sukuk attracted a subscription of N105.88 billion according to the DMO.

Source: Vanguard