Abuja, Nov. 15, 2024 – The Federal Executive Council (FEC) has approved a $2.2 billion external borrowing plan to boost federal government’s financial position and support its economic reforms.
Wale Edun, the Minister of Finance, disclosed this in Abuja on Thursday after the FEC meeting presided over by President Bola Tinubu.
Under the plan, about $1.7 billion will be raised through Eurobond offer, while $500 million will be raised through Sukuk bonds.
The minister said the plan would be executed in the current fiscal year with the final structure of the funding determined by market conditions based on the recommendations of transaction advisers.
“The first objective is to complete the federal government’s external borrowing program with the approval of the $2.2 billion financing package, which will include access to the international capital market through a combination of Eurobonds and Sukuk bonds, approximately $1.7 billion from the Eurobond offer and $500 million from Sukuk financing.
“The actual composition of the financing will be finalised once the National Assembly has considered and approved the borrowing plan.
“After the external borrowing approval is granted, the funds will be raised as soon as possible within the year.
“The exact combination of instruments will depend on the advice of transaction advisers and market conditions when we decide to enter the market.”
“Earlier in the year, we demonstrated the resilience of the Nigerian financial markets and their capacity to handle more complex and sophisticated offerings, such as the domestic issuance of dollar bonds that attracted investors from both Nigeria and abroad.”
The minister said that FEC also approved the creation of a N250 billion Real Estate Investment Fund to solve the country’s housing problems and provide long-term, affordable mortgage financing for Nigerians.
“Approval has been granted for the Ministry of Finance Incorporated (MOFI) real estate investment fund. This fund will serve as the basis for the revival of long-term mortgage financing in the Nigerian economy.
“The MOFI Real Estate Investment Fund will initially amount to N250 billion and will provide low-cost, long-term mortgages to Nigerians who wish to acquire homes.
“It will help address part of the 22-million-unit housing deficit.
“Of course, it will create jobs, stimulate economic growth, and pave the way for other private sector investors to participate in the housing construction industry, with significant benefits for the broader economy.
“The concept is long-term. Investors will have the opportunity to earn market rates of interest and returns on investment, blended with seed funding of N150 billion.”
