The Federal Government of Nigeria has plans to borrow between $4.5-5 billion this year, 2016 from multilateral agencies and the financial markets, the Finance Minister, Kemi Adeosun, has said.
In a statement distributed by the finance ministry, Adeosun said the country expects to issue a eurobond in 2016 as the country tries to fill the gaps in its budget left by the plunge in oil prices.
However, with yields on Sub-Saharan African debt rising steadily, the country may find that the market demands a high price, Bloomberg Economists has said.
Average yields on Sub-Saharan African eurobonds have increased from 5.8 per cent in April 2015 to 9.4 per cent in January 2016, according to Bloomberg data.
Nigeria’s economic crisis has worsened over the past few months.
Crude oil exports make up 95 per cent of Nigeria’s foreign earnings, and the country has suffered badly from a shortage of foreign currency.
The Central Bank has imposed a range of capital controls in an attempt to limit the pressure on the the naira, which is traded at an official rate of 197-199 to the dollar, but has at times been selling for 300 on the black market.
Foreign exchange reserves have fallen by $9 billion over the past 18 months, according to CBN figures.
The Nigerian stock market lost 21 per cent of its value in the first two weeks of trading of 2016.
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