BreakingNews 1/2/16 - Nigeria Seeks $3.5 Billion To Fund Budget

[ Masterweb Reports ] - Nigeria’s government is in talks for concessionary loans worth US$3.5 billion from the World Bank and African Development Bank to help finance a planned record budget this year, Nigerian Minister of Finance Kemi Adeosun said.


While discussions are ongoing, a formal request has not yet been made to the World Bank for US$2.5 billion and the African Development Bank for US$1 billion, Adeosun said by telephone on Sunday, adding that the government plans to tie them to specific capital projects, she said.


Nigerian President Muhammadu Buhari’s administration is seeking to spend its way out of an economic crisis triggered by a collapse in oil prices. Nigeria is Africa’s biggest oil producer and relies on crude for almost all its exports and two-thirds of government revenue.


Buhari has proposed boosting this year’s budget to a record 6.1 trillion naira (US$30.7 billion). Adeosun on Jan. 21 said that authorities are to borrow about US$5 billion in external debt from multilateral agencies and the Eurobond market to plug a record budget gap of 3 trillion naira.


Lawmakers in Nigeria’s parliament are to begin deliberations this week on this year’s spending plan, Adeosun said on Sunday.


Authorities are to begin non-deal roadshow meetings with investors to sound out a potential sale of US$1 billion of Eurobonds this month, she said.


Nigeria has issued US dollar bonds twice, most recently in 2013. Crude oil prices have dropped about 46 percent since June last year and were trading as low as US$35.14 per barrel in London yesterday.


The West African nation’s economy probably grew 3.2 percent last year, the slowest pace since 1999, according to a Bloomberg survey of economists.


*Photo Caption - Map of Nigeria 

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