Federal Executive Council (FEC) has approved a $2.2 billion financing programme to support the Federal Government’s external borrowing plan.
Gatekeepers News reports that the decision was disclosed by Wale Edun, the Minister of Finance and Coordinating Minister of the Economy, following a briefing after Wednesday’s FEC meeting in Abuja.
Edun emphasised the significance of this approval as a critical part of the federal government’s borrowing strategy to meet financial needs and support its economic recovery efforts.
“We just had the Federal Executive Council meeting, and I am privileged to present two memoranda to the Federal Executive Council. The first one was to complete the borrowing programme of the Federal Government in terms of external borrowing with the approval of a $2.2 billion financing programme,” Edun said.
The proposed financing package will include access to the international capital market, specifically targeting the issuance of Eurobonds and Sukuk bonds.
” It is made up of access to the international capital market for some combination of the Euro bond offer and the Sukuk bond offer, and perhaps a Euro bond of about $1.7 billion.
“Sukuk financing of another $500 million the actual makeup of the financing which will be done as soon as the National Assembly has considered and hopefully approve the borrowing plan, “ Edun stated.
The Minister explained that the next step involves submitting the borrowing plan to the National Assembly for approval, after which the external borrowing will be finalised.
Edun confirmed that once approved, the borrowing will be executed as soon as possible, likely within this year.
“If the external borrowing approval is given, it will be done this year, as soon as possible after approval,” he stated.
The composition of the financing instruments will depend on prevailing market conditions and the advice from financial advisors at the time of the decision.
He explained that the actual combination of instruments that would be raised would depend on what the advisors would say about market conditions at the time of the decision to enter the market
The Minister also reflected on the resilience of the Nigerian financial markets, particularly the success of the recent domestic issuance of dollar bonds, which demonstrated the market’s capacity and sophistication.
He highlighted this as a positive sign of confidence in Nigeria’s macroeconomic policies under the leadership of President Bola Tinubu.
“Earlier in the year, we had shown the resilience of the Nigerian financial markets, and the depth of their capacity, the increased complexity and sophistication by having a domestic issuance of dollar bonds, which attracted Nigerian investors from far and wide
“Likewise, being able to access the international capital market is also a sign of the acceptance and the support for the macroeconomic programmes of President Bola Tinubu-led administration,” he said.
