Senate approves FG’s $500m loan request for 2016 budget

The Senate on Wednesday, March 22, 2017, approved federal government’s

Vice President Yemi Osinbajo had on Wednesday, February 22, written to the National Assembly requesting to borrow $1 billion Eurobond to fund the 2016 budget deficit.

“The external borrowings incurred to date consist of USD 600 million from the African Development Bank and USD 1 billion Eurobond from the International Capital Market (ICM) only,” Osinbajo's letter read.

“Thus, based on the 2016 appropriation and applying the average exchange rate, there is headroom to access further international funds.

“Following the high over subscription of the recent USD 1 billion Eurobond issuance, we wish to take advantage of favourable market conditions to issuance of Eurobond debt instrument of USD 500 million to fund the implementation of the 2016 budget, which is still ongoing.”

ALSO READ: Eurobond: 7 Reasons why this loan should give you some hope

Osinbajo explained that the $500 million would be used as funding sources to finance the deficit, including capital expenditure projects as specified in the 2016 budget.

According to him, the Debt Management Office (DMO) and the government’s appointed transaction parties were working to ensure the best terms and conditions for the country as regards the loan