The Federal Government has approved a $2.2 billion external borrowing plan aimed at fortifying Nigeria’s finances and driving forward its economic reforms.
Minister of Finance, Wale Edun, announced this development on Thursday after the Federal Executive Council (FEC) meeting chaired by President Bola Tinubu at the Presidential Villa, Abuja.
Edun outlined that the financing package would come from a combination of Eurobonds and Sukuk bonds, with $1.7 billion expected from the Eurobond offering and an additional $500 million from Sukuk financing.
According to Edun,“The first objective is to complete the federal government’s external borrowing program with the approval of the $2.2 billion financing package,” he said, adding that the final structure of the funding will depend on “market conditions and the advice of transaction advisers.”
This borrowing plan, designed to be completed within the 2024 fiscal year, will advance once the National Assembly reviews and grants final approval.
“The actual composition of the financing will be finalized once the National Assembly has considered and approved the borrowing plan. After the external borrowing approval is granted, the funds will be raised as soon as possible within the year,” Edun confirmed.
Highlighting Nigeria’s growing financial stability, Edun described recent successes in domestic dollar bond issuances, which attracted both local and foreign investors, as evidence of confidence in the country’s economic direction.
He noted that the government’s policies, including market-based pricing for key economic variables like petroleum products and foreign exchange, have set the stage for this international borrowing initiative.
In addition to the borrowing plan, FEC approved a N250 billion real estate investment fund, aimed at reducing Nigeria’s housing deficit and providing accessible long-term mortgage financing for citizens.
This initiative, managed by the Ministry of Finance Incorporated (MOFI), seeks to offer affordable mortgage rates and extended tenures of up to 20 years, considerably below the market interest rates that often exceed 30%.
“Approval has been granted for the MOFI Real Estate Investment Fund,” Edun explained, stating that this fund would serve as the foundation for long-term mortgage financing in Nigeria.
He added, “The MOFI Real Estate Investment Fund will initially amount to N250 billion and will provide low-cost, long-term mortgages to Nigerians who wish to acquire homes. It will help address part of the 22 million-unit housing deficit.”
The fund is expected to generate significant economic benefits by creating jobs, driving growth, and attracting private sector participation in housing construction.
