The
federal government of Nigeria is in the process of appointing two lead managers
and a financial adviser to organize the issuance of $1 billion of Eurobonds
this year. According to the Debt Management Office (DMO), the sale is the first
tranche of a $4.5 billion Nigeria Global Medium-Term Notes Issuance Programme
that runs through 2018 Dr Abraham Nwankwo, DG of
DMO Dr Abraham Nwankwo, DG of
DMO The government aims to appoint two international banks as joint lead
managers and a local lender as financial adviser for the whole program,
according to the statement. According to Bloomberg, the DMO has already called
for bids are to be submitted latest 12 noon on Monday, September 19 at its
Abuja office. The move will enable Nigeria to have the flexibility of quickly
taking advantage of favorable market conditions in the international capital
market to raise funds if and only when the need arises.” The move is the first
time Nigeria is tapping into the Eurobond sales after attempts in 2011 and
2013. The government has since indicated its intention to borrow to shore up
the 2016 budget’s 2.2 trillion naira deficit. The government also promised
earlier in the year that it will increase spending especially on capital
projects to stimulate its already battered economy. The International Monetary
Fund had warned that the Nigerian economy could shrink by 1.8 percent in 2016.
Two weeks ago, Nigeria’s minister of finance, Mrs Kemi Adeosun told the
Nigerian Senate that Nigeria is ”technically in recession” after months of
insisting that the economy was doing well. The Central Bank of Nigeria (CBN)
governor, Godwin Emefiele set the ball rolling on Wednesday, July 20 during a
presentation to the Senate. A seemingly sober Emiefiele told the senators that
the country’s economy has been characterised by external shocks, sharp decline
in commodity prices and geo-political tensions along important global trading
routes among others. Meanwhile, fourteen (14) airlines have withdrawn their
services from Nigeria due to low patronage and the bad economy being experienced
in the country. The airlines are among the 50 that operated the Nigerian routes
some months ago. Some of those listed are Spanish-owned Iberia airlines, United
Airlines and Air Gambia among others.
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