The Federal Government is considering borrowing N251.6bn to finance the building of infrastructure to make up for Nigeria’s current infrastructure deficit.
The money will be sourced from the issuance of a $1bn Eurobond, $100m diaspora bonds and N80bn FG bonds through syndicated global depository notes.
The decision on whether to go ahead with this plan or not shall be made today during the weekly Federal Executive Committee (FEC) when the Minister of Finance and the Coordinating Minister of the Economy, Dr Ngozi Okonjo-Iweala will table a request for approval before the council.
Dr Okonjo-Iweala last week said that the government planned to prioritize infrastructure investment and also to leverage external financing for infrastructure investments in the country.
She explained that the government planned to augment Nigeria’s domestic resources with a proposed $1bn Eurobond as well as a Diaspora Savings Bond, which will harness savings from Nigerians abroad.
“These additional investments will be used in various infrastructure projects, such as building the country’s gas-to-power infrastructure. The government also plans to use Public-Private Partnerships (PPPs) aggressively, working with the Sovereign Wealth Fund which will attract co-investors from home and abroad, such as pension funds, institutional investors and so on to finance infrastructure,” she said.
She added that the government’s confidence is buoyed by the fact that Nigeria’s domestic bonds have gained international prominence and were recently included in the JP Morgan and Barclays Emerging Market Indices.
Projects that could also be financed by the loan include the Second Niger Bridge, for which some funds were provided in the 2013 budget.
Other matters to be discussed at the FEC meeting today include the review of the Export Expansion Grant scheme (EEG), which memorandum shall be presented by the Minister of Trade and Investment, Olusegun Aganga, and the reclamation and infrastructural development of FESTAC Phase II, which is to be tabled by the Minister of Lands, Housing and Urban Development, as it is awaiting the President’s anticipatory approval for the selection of the concessionaire/developer.