This comes a month after the National Assembly approved an external borrowing plan of USD6.2bn in August. Also, the IMF has approved the allocation of USD3.35bn in Special Drawing Rights (SDRs) to boost Nigeria’s foreign reserves. Combined, these have provided a modest boost to Nigeria’s faltering foreign-exchange reserves.
The proceeds from the Eurobonds sale will form a significant part of funding the 2022 budget.
The Eurobonds and SDR allocation, by boosting reserves, could help narrow the gap between formal and informal exchange rates.
There will likely be another Eurobond sale in 2022 as well as more multilateral and bilateral loans.
Nigeria’s weak tax collection infrastructure will not generate substantially improved revenues from expected growth.
