Nigerian Government plans $2.3 billion Eurobond sale before year end

The Nigerian Government hopes to approach the Eurobond market before the year winds down to raise $2.3 billion, its second return to the international bond market since last December when the $2.2 billion debt it issued ended a near three-year period of inactivity.

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A $500 million sukuk bond, the first of its kind to be offered by the country, is also in the pipeline.

“There are plans to issue Eurobonds in the fourth quarter of 2025, subject to market conditions,” Patience Oniha, the director-general of the debt office, said on Wednesday, according to a Bloomberg report.

“In terms of what we need it’s $2.3 billion,” she stated further, adding that the tenors of the securities from the offer will determine their pricing.

President Bola Tinubu on Tuesday sought the consent of legislators for foreign loans of the same value, proceeds of which will be used to partly fund the government’s spending plan for this year and refinance Eurobonds falling due next month.

A gradual shift towards an expansionary monetary policy, which favours borrowing for growth, from a contractionary position, often aimed at controlling inflation, is prompting African countries to find their way back to the international debt market to tap fund.

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Kenya, which cut rates for the eighth time in a row on Tuesday, and Angola raised billions of dollars in Eurobonds last week.

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In September, Nigeria also took the path of reducing its lending rate after five years of monetary policy tightening, which peaked last year, jumping by 8.8 per cent to 27.5 per cent.

The sovereign sukuk will finance infrastructural projects, while 25 per cent of the cash raised from the issuance will go to repaying “relatively expensive debt obligations,” provided the government is able to utilise its credit guarantee from the insurance arm of the Islamic Development Bank, President Tinubu said.