Sunday Ode, Abuja
The Federal Executive Council (FEC) has approved the issuance of $2.8billion eurobond to fund capital projects in the 2018 budget.
This was disclosed by the Minister of Finance, Zainab Ahmed Wednesday after weekly FEC meeting presided over by President Muhammadu Buhari,at the Presidential Villa, Abuja.
The minister also disclosed that the council had approved six Transaction Parties to advise the government on the issuance of $2.8 billion Eurobonds and other securities in the International Capital Market (ICM).
The Transaction Parties approved by the Council are Citigroup Global Market Limited, Standard Chartered Bank as joint manager; FSDH Merchant Bank Limited as financial adviser; White And Case LLP, Banwo and Ighodalo as legal adviser and Africa Practice Limited as technical adviser on communication.
According to her, the Transaction parties are expected to advise the Nigerian Government on the structure and timing, as well as, documentation for the issuance of the Eurobonds and other securities.
She said the approval is part of government’s commitment to the implementation of the 2018 Appropriation Act, adding that “Consistent with government’s policy on development of infrastructure, the proceeds of the Eurobond issuance will be deployed to fund critical capital projects in the 2018 Appropriation Act”.
She said: “Today, in the Federal Executive Council, we got approval for the issuance of $2.9 billion and other securities in Eurobonds from the international capital market .”The focus of this approval is to enable us implement the borrowing external plan of N849.67 billion equivalent of $2.786 billion which is provided for in the 2018 Appropriation Act and this is to fund capital projects in 2018 Budget.
“We also as part of that, got approval to raise the sum of $82.54million to bridge the shortfall of the 500million Eurobond that matured on the July 12, 2018. In addition to this approval for the issuance of Eurobond, we also got the approval for payment to transaction parties and their respective fees like settling bills and expenses.
“We have as parties for the transactions, two joint league managers, a combination of Citibank group as well as Standard Chartered Bank as joint league managers and FSB Merchant Bank as financial advisers; the White and Case LIP as legal managers and Ighodalo as legal advisers for Nigeria. The total cost for this advisory group is N374.618,889.”
The minister noted that council also gave approval for livelihood of family improvement project in Niger Delta in the sum of $60m that will be a combination of loans and grants, Ahmed said the projects will be implemented in the Niger Delta States of Abia, Akwa Ibom, Bayelsa, Cross River, Delta, Edo, Imo, Ondo and River
However, she pointed out that when the government reviewed the project in the nine states, they found that six of the states met their own requirements while three did not saying ” So, the three will be assisted to enable them improve and join the team in 209.
On capital release for the 2018 budget,she said “Let me also move to the question that borders on capital releases. About two weeks ago, N460 billion was released for capital budget. On Paris Club Refund, the minister said President Buhari has given approval for the payment of the last Paris Club refund to the states but the approval came with some conditions.
“Those conditions that Mr. President gave is that we must show that the states have used the previous refund for payment of salaries and they will use this one also for payment of salaries. “The states that were not paid were Akwa Ibom, Rivers and Imo State because they had some deficiencies and the agency that is handling it is working to bridge the gap,” she stated.
On the controversy surrounding the balance of payment for Ex-staff of Nigeria Airways,she said ” The approval given for payment of entitlements to the ex-staff of Nigeria Airways was N45 billion and because of paucity of funds, Mr. President gave approval for the payment of 50 per cent of N22.6 billion. We hope in 2019, to pay the balance.
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