The Federal
Executive Council (FEC) has approved the appointments of transaction parties to
execute the issuance of the proposed $1 billion Euro bond at the international
capital market.
According to the
Minister of Finance, Mrs Kemi Adeosun, who disclosed this while briefing State
House correspondents at the end of the Federal Executive Council (FEC) meeting
Wednesday in Abuja, the transaction parties are Citigroup, Standard Chartered
Bank, Stanbic IBTC, White & Case LLP, Banwo and Ighodalo and Africa
Practice Communications.
She explained that
the parties would also run any Eurobond issuance programme by the Federal
Government for the next three years.
She stated: “My memo,
which was approved by council, was for the appointment of transaction parties
for the $1 billion Eurobond issue”.
She explained that
the programme is part of the funding for 2016 budget to commence in January.
She added:“We
obtained certificate of no objection from Bureau for Public Procurement (BPP)
for the appointment of those parties having undertaken fully competitive open
tender process.
“We are confident
that we will be able to complete the transaction expediently with significant
interest . The oil price stability obviously is helping us , currently there is
quite a bit of demand for emerging markets papers . Nigeria’s paper is
currently trading around 7 to 8 per cent mark. We are expecting to get quite a
competitive pricing on the issuance programme which I said is to be used for
the purpose of funding capital projects in the 2016 budget within the month of
January.
“Angola came out in
November with bench mark $I.56 and Gabon
in June did $8.25 plus Ghana in
September did $9.25. So we’re expecting to get quite a competitive pricing on
the issuance programme which as I said is to be used for the purposes of
funding capital projects as part of the
2016 budget within the month of January.
“The other thing to
note is that these parties that have been appointed will run any euro bond
issuance programme that we do for the next three years. So we don’t have to
keep on re-tendering. Unless there is a major problem with any of them they
would be our parties for the next three years.”
Recall that to make
up for shortfall in the N6.06 trillion 2016 budget, the Federal Government
began the process of appointing banks for the sale of the Eurobond last
September and had said it wanted to issue the bond by the end of the year.
The Eurobond is in
addition to getting concessionary loans from the World Bank and China as oil
revenues dropped, but only the African Development Bank (AfDB) approved a $600
million loan, the first tranche of $1 billion total package.
Vice President, Yemi
Osinbajo had in media interview last month said that Nigeria was looking at
concluding the sale of $1 billion Eurobond by the end of the first quarter of
2017 and will seek to make its foreign exchange market more flexible.
Nigeria has sold
dollar bonds twice, the last time in mid-2013, when it raised $1 billion of
five- and 10-year debt. Adeosun who briefed trporters alongside the Minister of
Information, Culture and Tourism, Lai Mohammed and the Minister of Environment,
Amina Mohammed, said the Council approved the appointment.
The Environment
minister on her part said the council approved
the final amendment to the gazette of the establishment of the
hydrocarbon pollution restoration process/purchase.
It is a vehicle that
would have all the government structures
to allow it carry out the clean up in
the Niger Delta beginning with Ogoni land and the implementation of the UNEP report.
Mohammed said, “Why
is this so important? Well, what we have
in the past gazette did not put in palce some of the government structures we
need such as the government board, like the board of trustees or a structure
that would be held accountable for the enormous amount of money that is already
available to spend but additional moneies that we can leverage from the money
that we have that is being offered by different partners to come into cleaning up and then
dealing with the livelihoods after.
“To begin with the
building of the centre of excellence, the integrated soil treatment centre will
also go up and then we begin training but in this case we start training many
of the women on the livelihood side in the
contaminated areas.”
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