The
Federal Government will issue Eurobond to raise $2.5 billion before the end of
2017 to fund critical infrastructure in the country, the Debt Management Office
(DMO) has said yesterday. This is just as the central government advocated for
an urgent action towards economic development and diversification as the
country gradually exits recession. DMO’s Director-General, Ms. Patience Oniha,
stated this at the 2017 Nigerian Debt Capital Markets Conference & Awards
organised by the FMDQ OTC Securities Exchange in Lagos.
Oniha
said that the borrowing would enable the country bridge the gap in the 2017
budget presently facing liquidity problem to finance some capital projects. She
said that the proposed Eurobond issuance would complement the $1.5 billion
raised from the international market in March 2017.
Oniha
stated that the nation’s Treasury Bills portfolio presently stood at N3.7
trillion, noting that it planned to refinance it with foreign borrowing to
reduce pressure on the domestic market. She said that Nigeria needed to build
stronger and responsive institutions that could support infrastructure agenda
of the government.
The
DMO boss added that government had proposed to channel new borrowings into
capital investments instead of consumption. “The debt ratio is not tangible and
adequate components of borrowing because it is not going into funding others
than capital investment.
Let
us channel new borrowings into capital investment instead of consumption,”
Oniha said. On the N100 billion Sukuk Bond, she said that the Federal
Government had identified 25 road projects to be funded with the proceeds.
She
said that among the roads listed was Ore–Sagamu road, Kaduna bypass, Enugu Port
Harcourt road, Kano–Maiduguri, Benin– Lokoja road, among others. According to
her, government has also decided to finance other Trunk A roads that would
provide support that is needed to accelerate nation’s developmental goals.
She
said Nigeria needed to build stronger and responsive institutions that can
support infrastructure agenda of the government. “We need to build the business
in terms of products that meets specific needs of investors,” she stated. Oniha
said that the acceptance of the 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. Speaking earlier, Vice President Yemi Osibanjo called for an
urgent action towards economic development and diversification as the country
exits recession.
Osibanjo,
who was also represented by Oniha, said that assessing the debt capital market
was needed to bring the desired economic growth and diversification.He said
that with the growing population, the private sector participation was also
needed to complement government efforts in area of infrastructure development.
The
vice president stated that the private sector was efficient in handling
projects anywhere in the world. Osinbajo added that the current determination
of the Federal Government on the ease of doing business was to enable more
investment flow into the country.
“Ease
of doing business makes it easy for business start-ups to grow their business,”
Osinbajo said. The Finance Minister, Mrs. Kemi Adeosun, noted that government
was restructuring the economy to give nation’s development a leap.
Source: newtelegraphonline.com
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