Tinubu Administration Plans to Raise N2.5 Trillion in Bonds Amidst Economic Turmoil
Written by Deborah Oyinloye on February 15, 2024
As Nigeria grapples with escalating economic challenges, the Bola Ahmed Tinubu-led government has unveiled plans to raise N2.5 trillion through its second FGN bonds auction, signaling a continued reliance on borrowing to bolster the nation’s finances. The announcement, made by the Debt Management Office (DMO), comes amidst growing concerns over the country’s rising debt burden and the impact of austerity measures on its citizens.
In a circular issued on Wednesday, February 14, 2024, the DMO disclosed that the offerings would consist of N1.25 trillion with a maturity date of February 2031 and N1.25 trillion with a 10-year tenor. These FGN savings bonds form part of the federal government’s domestic borrowing plan, aimed at financing budget deficits and funding critical infrastructure projects.
Last year, the Federal Government raised approximately N7.06 trillion from the fixed-income market, with projections indicating a further increase to N7.83 trillion in the current fiscal year. President Tinubu had previously sought approval from the National Assembly for substantial external borrowings, highlighting the government’s reliance on both domestic and foreign debt to meet its financial obligations.
The latest issuance of FGN bonds, with a face value of N1,000 and semi-annual interest payments, targets institutional and retail investors. However, concerns have been raised regarding the sustainability of Nigeria’s debt levels and the implications for future generations.
Meanwhile, prominent figures such as the Sultan of Sokoto and the Nigerian Bar Association (NBA) have decried the worsening socio-economic conditions in the country, exacerbated by the removal of fuel subsidies. The Sultan, addressing a gathering of traditional rulers in Kaduna, highlighted the pervasive poverty and insecurity plaguing Nigeria, calling for urgent action to address these pressing issues.
Similarly, the NBA President urged the government to declare a state of emergency on insecurity and prioritize investments in security systems to restore public confidence and safeguard citizens’ livelihoods.
Author: Deborah Oyinloye
With an interest in media, Deborah aims to impart the lives of people positively.
