By Emmanuel Nduka and Chioma Iruke
The Nigerian Government has revealed plans to raise $3bn from Eurobond sales in the second week of October 2021.
According to the Government, the $3bn constitutes half of the amount needed from external borrowings to fund the 2021 budget deficit.
The country’s Minister of Finance, Budget, and National Planning, Zainab Ahmed, disclosed this during an interview on Bloomberg TV.
“We should be going to the market in the second week of October. The government has approved to raise $6.1bn from overseas. So we are looking at doing half of that in the Eurobond market and the other half from bilateral and multilateral sources. Depending on how the market goes, maybe we can do a little bit more,’’ she said.
This development comes just as President Muhammadu Buhari recently announced that the Nigerian National Petroleum Corporation (NNPC) made a profit of N287bn, after tax deduction in 2020.
Buhari who doubles as Nigeria’s Minister of Petroleum Resources, said the declaration was in fulfillment of an earlier pledge by the Federal Government to publicly announce the financial position of the NNPC.
“I am pleased to announce the declaration of Profit after Tax of Two Hundred and Eighty Seven Billion Naira (N287 billion) in Year 2020 by the Nigerian National Petroleum Corporation.
“This is sequel to the completion of the statutory Annual Audit exercise for Year 2020.”The NNPC losses were reduced from N803 billion in year 2018 to N1.7 billion in year 2019 and the eventual declaration of Net Profit in year 2020 for the first time in its 44-year history.
“This development is consistent with this administration’s commitment to ensuring prudent management of resources and maximization of value for the Nigerian people from their natural resources.
“I have further directed the Nigerian National Petroleum Corporation to timely publish the Audited Financial statements in line with the requirements of the law and as follow up to our commitment to ensuring transparency and accountability by public institutions,” he noted
Meanwhile, the Finance Minister while announcing the latest borrowing, said the Federal Government was targeting single-digit inflation by 2023, and that the $3.3bn Special Drawing Rights from the International Monetary Fund (IMF) had helped to boost the country’s external reserves and will help stabilise the naira.
“We certainly feel we have passed the worst of it. Our projection is that inflation will continue to go down throughout 2021 and 2022. Our target is to get to single-digit inflation by 2023.
“The central bank is doing everything within limited constraints to stabilise the currency. The SDR of $3.35bn just received from the International Monetary Fund have helped shore up the reserves and will help stabilise the currency.
“Also, the withdrawal by the central bank of funding to unauthorised dealers will increase supply to the formal market to meet demand,” she said.
On the country’s debt, she said, “The government is now working to reduce its debt-service burden by increasing revenue, restructuring its debt portfolio through the conversion of expensive short-term notes into longer tenors, and also reducing its overall borrowing.
“Our target is to triple revenues from about eight percent of the Gross Domestic Product to 15 percent, and also grow the economy by seven percent.”