Nigeria is targeting as much as $2 billion through the issuance of Dollar-denominated bonds to local investors which opened today, Monday, August 19.
This is according to the lead arranger of the instrument, United Capital Plc.
The domestic dollar bond has a programme size of $2 billion, with series one opening on Monday at a size of $500 million, the investment bank, Bloomberg reported.
According to the report, the bonds will have a five-year tenure and would be available to Nigerians residing in the country and abroad as well as local pension firms.
The issuance is targeting funds from “domiciliary accounts, diaspora remittances and foreign investments,” United Capital said.
It was also disclosed that Dollar cash deposits will not qualify unless they were made into domestic accounts at least 30 days before the issue.
Last week, Nigeria announced that it will issue Dollar bonds locally to help bridge infrastructure finance gaps and save the weakening Naira given market conditions haven’t been favourable for the offer of Eurobonds.
The President Bola Tinubu-led administration approved a N28.8 trillion budget plan for the 2024 fiscal year but faced with dwindling revenue, the country is left with a deficit of N9.8 trillion.
Although it had initially said it would reduce its borrowing, unlike its predecessor under the Muhammadu Buhari administration.
Plans to raise taxes have so far not materialised so the circumstances have forced the government to seek financing from domestic and international borrowing. So far, Nigeria’s debt has ballooned to N127 trillion.
Modupe Gbadeyanka