The Presidency on Wednesday sought the approval of the National Assembly to raise additional $500 million Eurobond from the international capital market.
The fund, according to Acting President Yemi Osinbajo, is required to finance the total sum of N4.023 trillion budget deficit in the 2016
and 2017 fiscal years respectively.
Meanwhile, there are strong indications that the passage of the 2017 budget will be delayed this year, as was the case last year, despite assurances by Bukola Saraki, President of the Senate, that lawmakers will conclude the appropriation process three weeks after they resume plenary on Tuesday.
This is because some of the Ministries, Departments and Agencies (MDAs) particularly, the Ministry of Foreign Affairs, the Independent National Electoral Commission (INEC), Economic and Financial Crimes Commission (EFCC) and many others, are yet to defend their budget proposals.
On the proposal to raise additional $500million Eurobond, Osinbajo said in the two-page letter read by Speaker Yakubu Dogara at the House of Representatives and also presented to the Senate, that government intends to leverage the present favourable market conditions to issue the Eurobond debt instrument to fund the implementation of the 2016 budget, which is still ongoing.
“The Rt. Honourable Speaker may wish to refer to line items 229 and 244 of the 2016 Federal Government of Nigeria (FGN) Appropriation Act,
which provided for a deficit of N2.205 trillion and new borrowings of N1.818trillion respectively.
“The Act also provided for Domestic Borrowing of N1.182 trillion and external borrowing of N635.88 billion in line items 245 and 246
“Following the high oversubscription of the recent USD 1 billion Eurobond issuance, we wish to take advantage of favourable market conditions to issue a Eurobond debt instrument of USD 500 million to
fund the implementation of the 2016 budget, which is still ongoing.
“The Rt. Honourable Speaker may wish to note that in line with the requirement of securities issuances in the ICM, a specific resolution of the National Assembly, as a firm confirmation of the approval of
the Legislature for the Federal Government of Nigeria (FGN) to borrow the USD 500 million through the issuance of a Eurobond debt instrument
in the ICM is required,” the Acting President noted in the letter which he sent to the Parliament.