The Federal Government’s plan to issue USD3 billion worth of foreign bonds of up to three years maturity to refinance maturing naira-denominated treasury bills, if approved, will have a modest impact on broad debt sustainability indicators, experts at PricewaterhouseCoopers (PwC Nigeria) have said.
In line with Federal Government’s debt management strategy to rebalance its debt portfolio for domestic and foreign debt, from the current 69 per cent: 3 1 per cent to a targeted 60per cent: 40 per cent, the Federal Executive Council (FEC) recently approved a plan to issue USD3 billion worth of foreign bonds of up to three years maturity to refinance maturing naira-denominated treasury bills.
Although, the National Assembly is yet to approve this plan, Partner & Chief Economist Andrew S Nevin and Senior Manager & Economist Adedayo Akinbiyi, both at PwC Nigeria, said in their latest economic alert accessed by The Nation that the impact of Nigeria’s refinancing plan on her debt sustainability is likely to be modest.
The experts noted that although timelines are not clear, they suspect issuance is unlikely to be earlier than 2018, given the extensive preparatory work required in issuing international sovereign bonds.
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