Economy
It’ll be Difficult to Sell Proposed FG’s N22.7trn 40-year Bonds at 9%—BudgIT
By Dipo Olowookere
A Nigerian civic company, BudgIT, has said, based on findings, it would be difficult for the federal government to get buyers for the proposed securitisation of the N22.7 trillion overdrafts of the Central Bank of Nigeria (CBN) at 9 per cent per annum coupon rate.
President Muhammadu Buhari on Tuesday appealed to the National Assembly to reconsider his request to convert the ways and means into securities.
The bonds, to be sold to interested investors in local denomination, would have a maturity of 40 years at a coupon rate of 9 per cent.
Last week, the Senate rejected the proposal, pointing out that it must know what the government spent the money on.
The government violated the CBN act as regards the overdrafts as it was supposed to get 5 per cent of the revenue it generated in the previous fiscal year as ways and means, which must be paid back before another is given.
However, these requirements were not met by the federal government but the central bank, under the leadership of Mr Godwin Emefiele, went ahead to give more loans to the government to fund the budget deficits.
While signing the 2023 budget into law on Tuesday, Mr Buhari begged the parliament to approve the conversion of the loans to bonds to avoid the payment of an extra N1.8 trillion as interest.
“I have no intention to fetter the right of the National Assembly to interrogate the composition of this balance, which can still be done even after granting the requested approval.
“Failure to grant the securitization approval will, however, cost the Nigerian government about N1.8 trillion in additional interest in 2023, given the differential between the applicable interest rates, which is currently MPR plus 3 per cent, and the negotiated interest rate of 9 per cent and a 40-year repayment period on the securitised debt of the Ways and Means,” he had pointed out.
But BudgIT said the claims by Mr Buhari that the 40-year bonds would be sold at 9 per cent may not be totally true.
Business Post reports that the FGN savings bond currently being offered for sale by the Debt Management Office (DMO) has coupon rates higher than what the government is claiming.
The debt office is offering the 2-year FGN savings bond maturing on January 11, 2025, at 9.60 per cent and the 3-year paper maturing on January 11, 2026, at 10.60 per cent.
At the last FGN bonds held in December 2022, the debt office sold a 10-year bond at 14.75 per cent and a 20-year bond at 15.80 per cent. Based on this, it would most likely be difficult to lure investors to purchase 40-year bonds at 9 per cent when a shorter-tenor paper can be bought at almost double the coupon rate.
In a series of tweets via its official Twitter page on Thursday, BudgIT said it would be a herculean task for the government to get buyers for the bonds at the “specified rate.”
“@MBuhari has asked @nassnigeria to approve the securitization of FG’s N22.7tn debt to @cenbank, is it legal for @nassnigeria to approve the request of the FG to securitize the Ways & Means, which goes against the CBN Act?
Since 2015, the FG has asked @cenbank to provide advances to fund its fiscal deficit without any requirement for cost-cutting measures/fiscal control. The law stipulates that such advances should be limited to 5% of the previous year’s revenues. This law has not been followed.
“Also, Section 38 of the CBN Act mandates the FG to repay all advances made by the CBN to it at the end of the financial year in which the advances were received. Failure to repay the advances in full implies that the FG will not be eligible for further advances by the CBN.
“While FG has continuously breached the CBN Act, it now seeks the @nassnigeria’s approval to offload N22.7tn debt for 40 years at a 9% interest rate. Findings have shown that it will be difficult to sell such debt at the specified rate.
“Currently, the FG has been on a borrowing binge as domestic debt increased from N8.3tn in June 2015 to N21.6tn as of June 2022, & foreign debt rose from $10b in 2015 to $39.66b in 2022.
“Similarly, interest paid in Ways and Means (CBN Debt to FG) grew from N9.51b in 2017 to N1.22tn in 2021. In the meantime, the CBN’s new debt adds at least N2.5tn annually to Nigeria’s debt servicing costs.
“According to a recent MTF, Nigeria’s debt servicing cost is projected to reach N10tn in 2025. If National Assembly approves this action, FG’s public debt will rise from its current state by 59% – from $89.5b to $142 billion.
“In 2021, FG used 91% of its N4.64tn revenue to service public debt. Unless something drastic happens with revenue growth, the FG will spend more on servicing debt. This has implications for inflation, economic confidence, higher interest rates & weakened exchange rates.
“Is it legal for the National Assembly to approve the request of the Federal Government to securitise the Ways and Means, which is in clear breach of the CBN Act? More importantly, what were the borrowings used for?” the company asked.
By Adedapo Adesanya
The chief executive of HBM Nigeria Plc (formerly Lafarge Africa), Mr Lolu Alade-Akinyemi, said the cement producer is expected to add 4.5 million tonnes to its production capacity by January 2027.
HBM Nigeria Plc is positioning itself for stronger long-term competitiveness, market leadership and job creation as it accelerates expansion projects.
The transition to HBM Nigeria marks a new phase of growth, driven by operational excellence, sustainability, innovation, and infrastructure development, while maintaining its long-standing commitment to Nigeria’s construction sector.
Mr Alade-Akinyemi, speaking recently in Lagos, said the ongoing expansion of the company’s Ashaka and Sagamu plants would significantly boost local production, create employment opportunities, and support businesses across its value chain.
“We recently announced the expansion of the Sagamu plant in Ogun State and the Ashaka plant in Gombe State. Hopefully, in January 2027, we will commission both plants, adding 4.5 million tonnes to our capacity. Traditionally, building a new plant takes about three years, but this is one of the benefits of belonging to the Huaxin Group,” he said.
According to him, the projects will generate employment, create opportunities for young people and women, strengthen local suppliers and contractors, and contribute further to Nigeria’s economic growth.
“There are many vacancies we are trying to fill in Sagamu and Ashaka. Beyond direct employment, we are creating opportunities for small businesses, developing suppliers and supporting local contractors. This is an exciting period because it will deliver significant benefits to Nigeria,” he said.
Mr Alade-Akinyemi noted that while the company’s corporate identity had changed following its acquisition by Huaxin Building Materials Group, its core values and commitment to customers, host communities, employees and shareholders remain unchanged.
He said HBM Nigeria traces its roots to 1959 as West African Portland Cement Company (WAPCO), with its first cement plant commencing operations in Ewekoro, Ogun State, in 1961.
Since then, he said, the company has grown into one of Nigeria’s leading building solutions providers with integrated plants in Ewekoro, Sagamu, Ashaka and Mfamosing.
He added that the company, which became publicly listed in 1979, has continued to expand through acquisitions and transformation while maintaining high product quality, innovation and responsible operations.
Highlighting the strengths of its parent company, Alade-Akinyemi described Huaxin Building Materials as a globally recognised building materials manufacturer founded in 1907 and headquartered in Wuhan, China, with operations across 16 regions in China and 14 countries worldwide.
He said Huaxin’s engineering expertise and focus on research and development would strengthen HBM Nigeria’s operations and help close engineering skills gaps in the country.
“As HBM Nigeria, we are strategically positioned for long-term competitiveness and stronger market leadership while reinforcing our commitment to supporting Nigeria’s infrastructure development and economic progress after more than six decades of industry leadership,” he said.
He also said sustainability would remain central to the company’s operations, noting that it had introduced lower-carbon products and continued to invest in environmentally friendly production processes.
By Adedapo Adesanya
The Federation Account Allocation Committee (FAAC) distributed about N2.550 trillion from the revenue generated by the nation in June 2026 to the three tiers of government after its July meeting in Abuja.
A statement signed by the Director of Press in the Office of the Accountant General of the Federation, Mr Bawa Mokwa, “The N2.550 trillion total distributable revenue comprised N1.809 trillion in distributable statutory revenue and N740.724 billion in distributable Value Added Tax (VAT) revenue.”
It was gathered that a total gross revenue of N4.500 trillion was available in June 2026, with deductions for the cost of collection amounting to N160.744 billion, and transfers and refunds at N1.789 trillion.
According to a communiqué after the gathering, gross statutory revenue of N3.700 trillion was received in June 2026, N1.049 trillion higher than the N2.651 trillion received in the preceding month, while gross revenue of N799.746 billion was generated from VAT, N56.058 billion higher than the N743.688 billion recorded in May 2026.
It was stated that from the N2.550 trillion total distributable revenue, the federal government received N923.438 billion, the state governments got N838.208 billion, while the local government councils were given N591.390 billion, with N197.610 billion allocated to the benefiting states as 13 per cent of mineral derivation revenue.
From the N1.809 trillion distributable statutory revenue, the federal government went away with N849.366 billion, states shared N430.810 billion, local councils took N332.136 billion, while the benefiting states got N197.610 billion as derivation revenue.
From the N740.724 billion distributable VAT earnings, the central government got N74.072 billion, the states received N407.398 billion, and the local government councils were allocated N259.253 billion.
The communiqué further stated that in June 2026, collections from Companies Income Tax (CIT), Capital Gains Tax (CGT), Stamp Duties (SDT), Petroleum Royalties, Gas Flare Penalties, Rent, Mineral Oil Royalties (MOR), Value Added Tax (VAT), Import Duty, and Common External Tariff (CET) Levies increased significantly, while Petroleum Profit Tax (PPT), Hydrocarbon Tax (HT), Mineral Royalties, and Fees declined considerably. Excise Duty recorded only a marginal increase.
By Adedapo Adesanya
The Nigeria Revenue Service (NRS) says the rollout of electronic invoicing (e-invoicing) will strengthen tax compliance, curb revenue leakages and improve transparency in tax administration as it moves to fully digitise the country’s tax system.
The Project Lead for the NRS e-Invoicing Project, Mr Mohammed Bawa, stated this at the DigiTax E-Invoicing Compliance Breakfast Session held in Lagos on Wednesday.
The event, organised by DigiTax, an NRS-accredited e-invoicing platform, formed part of efforts to support the agency’s ongoing education and sensitisation campaign on the e-invoicing mandate.
Mr Bawa said the initiative aligns with global trends in tax digitisation and is expected to help improve Nigeria’s tax-to-GDP ratio, which remains one of the lowest in Africa.
According to him, the system will provide the NRS with greater visibility into transactions across sectors, formalise activities within the informal economy and standardise invoice formats nationwide using globally recognised invoice schemas.
He added that e-invoicing would improve operational efficiency for both businesses and tax authorities while supporting the NRS’ transition from manual and electronic tax administration processes to a fully automated system-to-system interaction model.
Mr Bawa noted that the legal framework for implementation is backed by the Nigeria Tax Administration Act, which prescribes penalties for non-compliance.
He disclosed that the NRS has completed onboarding large taxpayers and is preparing to enforce compliance with defaulting entities.
According to him, medium taxpayers are expected to begin compliance in the third quarter of 2026, while onboarding of emerging taxpayers will commence in 2027, with full adoption targeted for all taxpayers by the end of 2028.
Mr Bawa urged taxpayers yet to be onboarded onto the platform to begin the process and work with accredited service providers to ensure compliance.
On his part, Country Director of DigiTax Nigeria, Mr Olumide Akinsola, urged businesses to look beyond their internal systems and assess the compliance status of suppliers and counterparties.
He warned that businesses whose suppliers fail to transmit invoices through the MBS platform risk losing eligibility to claim Value Added Tax (VAT) input credits on such transactions, describing the resulting supply chain exposure as a significant commercial risk that many organisations have yet to quantify.
Mr Akinsola also announced the launch of DigiTax’s white paper, The State of E-Invoicing Readiness in Nigeria, which examines compliance adoption trends and the readiness gap across different taxpayer segments.
He added that DigiTax operates in Nigeria, Kenya, Zambia and the United Arab Emirates (UAE), noting that experience from those markets shows businesses that integrate early are better positioned to avoid disruptions when enforcement begins.
