FEC approves $2.2 billion for foreign borrowing plan

The Federal Executive Council (FEC) has approved a $2.2 billion financing program to support the Federal Government’s external borrowing plan.

The decision was announced by the Minister of Finance and Coordinating Minister for the Economy, Mr. Wale Edun, following a briefing following the FEC meeting held in Abuja on Wednesday.

Edun emphasized the importance of this approval as a critical part of the federal government’s borrowing strategy to meet financial needs and support economic recovery efforts.

“We just had the Federal Executive Council meeting and I have the privilege of presenting two memoranda to the Federal Executive Council. The first of these was the completion of the Federal Government’s foreign borrowing program with the approval of a financing program of 2.2 billion dollars.” Edun said.

Eurobond and Sukuk bonds

The proposed financing package will include access to the international capital market, specifically targeting Eurobond and Sukuk bond issuance.

” This consists of a combination of a Euro bond offering and a Sukuk bond offering, and perhaps access to the international capital market for a Euro bond of around $1.7 billion.

“Another $500 million sukuk financing will be realized as soon as the actual structure of the current financing is evaluated and approved by the National Assembly borrowing plan, Edun stated.

The Minister announced that the next step is to submit the borrowing plan to the Turkish Grand National Assembly for approval, after which the external borrowing will be finalized.

Edun confirmed that once approved, the borrowing will be carried out as soon as possible, likely within this year.

“If external borrowing approval is given, it will be done as soon as possible after approval is received this year.”” he said.

market conditions

• The composition of financing instruments will depend on current market conditions and the advice of financial advisors at the time of the decision.
• He explained that the actual combination of instruments to be upgraded will depend on what advisors have to say about market conditions at the time of the decision to enter the market.
• The Minister also noted the resilience of Nigerian financial markets, particularly the success of the recent domestic dollar bond issuance, which demonstrates the capacity and sophistication of the market.
• He stressed that this was a positive sign of confidence in Nigeria’s macroeconomic policies under the leadership of President Bola Tinubu.

“Earlier in the year we demonstrated the resilience of Nigerian financial markets, the depth of their capacity, and the increasing sophistication and sophistication of domestic dollar bond issuance, which was attracting Nigerian investors from far and wide.

Likewise, having access to the international capital market is also an indication that the administration led by President Bola Tinubu accepts and supports its macroeconomic programs.he said.

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In addition to the borrowing program, the FEC also approved the establishment of the Morph Real Estate Investment Fund, which will help close Nigeria’s housing deficit and promote long-term mortgage financing.

“Morph Real Estate Investment Fund will be a N250 billion fund that will initially provide low-cost and long-term mortgages to Nigerians looking to buy homes.he said

The new real estate fund is expected to make a significant contribution to reducing the housing deficit in the country, which currently stands at 22 million units.

“It will help complete or partially close the housing deficit of 22 million units.” he said.

This is a step towards revitalizing the housing sector, creating jobs and stimulating economic growth. Additionally, the fund will pave the way for private sector investors to participate in the housing construction sector.

“IThis will also pave the way for other investors in the private sector to come and participate in the very important housing construction sector, which will bring great benefits to the entire economy and create knock-on effects.

“Long-term investors have the opportunity to earn market interest rates on investment. This will be blended with seed financing of N150 billion,Edun stated.

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