FG has budgetary provisions to meet debt obligations — DMO
Debt Management Office (DMO) has said that the Federal Government has made adequate budgetary provisions to meet the country’s foreign and local debt obligations.
DMO in a statement said Nigeria’s debt management practice is in accordance with relevant legislations and regulations in compliance with international practices.
It said Nigeria had, over the years, serviced its external and domestic debts promptly, which has made the federal government’s securities attractive to foreign and local investors. It cited the recently successfully priced 2.2 billion Eurobond in the international capital markets, which was oversubscribed by over $9 billion.
“Nigeria attracted a wide range of investors from multiple jurisdictions including the UK, North America, Europe, Asia, Middle East and participation from Nigerian investors.
It is an expression of continued investor confidence in the country’s sound macroeconomic policy framework and prudent fiscal and monetary management.
“The transaction attracted a peak order book of more than $9 billion, this underscores the strong support for the transaction across geography and investor class,” it said.
DMO stated that demand came from a combination of fund managers, insurance and pension funds, hedge funds, banks and other financial institutions.
In addition, one of the landmark achievements of the Eurobond is that it opened up opportunities for banks and other corporate entities in the Eurobond market.
The Debt Management Office, said that increased investors’ interest in the FGN bonds, the Sukuk bonds and other FGN securities, also attest to the country’s strict adherence to best practices in debt management, assuring that there were adequate provisions in the Medium Term Expenditure Framework and the annual budgets to meet the country’s debt service obligations when due.
It added that through borrowing, Nigeria now has a robust domestic capital market, with many local and foreign investors showing interest.
Meanwhile, the Minister of Finance and Coordinating Minister of the Economy, Wale Edun, said the successful issuance of the Eurobonds signposted increasing confidence in the government’s ongoing efforts to stabilise the Nigerian economy.
According to Mr Edun, the broad range of investors’ appetite to invest in our Eurobonds is encouraging as we continue to diversify our funding sources and deepen our engagement with the international capital markets.
Also, the governor of the Central Bank of Nigeria, Yemi Cardoso, said the outcome underscored investors’ growing confidence and Nigeria’s credit resilience.
