The Federal Executive Council (FEC) has approved a $2.2 billion external borrowing plan to boost Nigeria’s finances and support economic reforms. The approval was confirmed on Thursday by Wale Edun, Minister of Finance and Coordinating Minister of the Economy, following a FEC meeting chaired by President Bola Tinubu.
Edun announced that the financing would be secured through a mix of eurobonds and sukuk bonds, with an anticipated $1.7 billion from the eurobond issuance and $500 million from sukuk financing. The borrowing is planned for the current fiscal year, with final arrangements dependent on market conditions and guidance from transaction advisers.
“The objective is to complete the federal government’s external borrowing programme with a $2.2 billion financing package,” Edun explained. “The funding will come from a blend of eurobonds and sukuk, with approximately $1.7 billion from eurobonds and $500 million from sukuk financing.”
The exact composition of the borrowing package will be finalized after National Assembly approval, and the funds will be raised as soon as possible. Edun emphasized that the government’s recent market-based reforms, including changes to foreign exchange and petroleum pricing, were instrumental in securing international support for the borrowing plan.
Additionally, Edun announced that the FEC had approved the creation of a N250 billion real estate investment fund under the Ministry of Finance Incorporated (MOFI) to address Nigeria’s significant housing deficit. The fund will facilitate long-term, affordable mortgage financing, with an initial N150 billion in seed capital, aimed at reducing the country’s 22-million-unit housing shortfall.
“This MOFI real estate investment fund will be the foundation for reviving long-term mortgage financing in Nigeria,” Edun said. “It will provide low-cost, long-term mortgages to Nigerians seeking to own homes and stimulate job creation and economic growth. The concept is structured to attract private sector investment with market-rate returns blended with government seed funding.”
The fund aims to provide Nigerians with mortgage options at significantly lower interest rates, with repayment tenures extending up to 20 years. The FEC’s latest economic moves mark a significant step towards financing Nigeria’s development goals while also supporting broader economic growth and stability.