Nigeria’s National Assembly parliament has approved the Federal Government’s request to raise $1 billion via issuance of a Eurobond on the international debt market to help finance deficit in the 2017 budget, according to the senate spokesman on Wednesday.
Ahead of the Eurobond issuance, global rating agency, Fitch Ratings, had on Monday, assigned B+ rating to Nigeria, the lowest investment grade assigned to a security, signifying that the country has a moderate chance of default.
Some analysts believe grade shows concerns by foreign investors about the country’s macro-economic and foreign exchange policies, a pointer to the fact that the road show embarked on by the federal government team led by Finance Minister Kemi Adeosun and Deputy Governor of Central Bank of Nigeria, CBN, Mrs. Sarah Alade, may not yield much. This is besides the fact that the country will pay a higher premium for the bond issue, to encourage investors to subscribe.
Finance Minister Kemi Adeosun, Central Bank of Nigeria (CBN) Governor, Godwin Emefiele and other senior government officials have been meeting investors in London and the United States on a roadshow to issue the bond with a 15-year maturity.