Oyetunji Abioye with agency report
The Federal Government is planning to issue a Diaspora bond by March to raise funds from Nigerians living abroad, after completing a $1bn Eurobond sale this month, a source in the Ministry of Finance has said.
The country is currently in its first recession in 25 years and needs to find money to make up for shortfalls in its budget.
Low crude oil prices and militant attacks in the Niger Delta have slashed the country oil revenues.
The Federal Government had first announced plans to sell Diaspora bonds in 2013, to raise between $100m and $300m.
However, the Federal Government at the time could not finish appointing book-runners for the sale before the election that took away former President Goodluck Jonathan from office.
The Federal Government is planning to borrow up to $10bn, with about half of that coming from foreign sources as it seeks to boost overseas loans to plug funding gaps and lower costs.
But so far, only the African Development Bank has publicly confirmed a budget support package of $1bn. The Federal Government has held talks for months with the World Bank, China and other institutions to fund the budget gaps, according to Reuters.
In December, the Federal Government appointed Citigroup, Standard Chartered Bank and Stanbic IBTC Bank to manage the $1bn Eurobond sale, which it hopes to begin marketing in January.
Remittances are the second-largest source of foreign exchange receipts in Nigeria, after oil revenues. Citizens living abroad send at least $10bn home annually.
Nigeria is the world’s fifth-biggest destination for international remittances after China, India, the Philippines and Mexico, with five million Nigerians living abroad sending money back to relatives, according to Western Union.
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