Various efforts by the Debt Management Office(DMO) to deepen the bonds market and engender access to long-term funding have begun to yield results as 20 companies have been able to raise N200 billion from the market.
The Director-General of DMO, Dr. Abraham Nwankwo, who disclosed in Enugu while briefing the press on “Advances in, and Status of the Public Debt Management in Nigeria.”
He explained that apart from management Nigerian public debts, DMO had been able to elongate and establish sovereign yield curve of three months to 20 years, thereby creating a market for long-term funds.
According to him, while the N200 billion was raised from the domestic market by the companies to fund their various projects, others have accessed the international capital market for funds following the successful issuance of $500 million federal government’s Eurobond that opened the way for other private firms.
Nwankwo described the development as a result of the transformation agenda of the current administration, adding that the achievements recorded in the development of the domestic debt market led to the recognition and endorsement of the FGN bond market by reputable international financial institutions such as JP Morgan and Barclays Capital.
“The opening of access and establishment of the sovereign benchmark has helped to: provide foreign investors with requisite market information for investment decisions; create market benchmark for future borrowings by the sovereign, sub-nationals and corporates and attract foreign direct investments,” he said.
The DMO boss added that apart from the management the debts of the federal government, the implementation of the strategic framework to assist the states of the federal government to develop debt management institutions and capabilities has led to positive result.
“For the first time, the country now has actual and comprehensive debt data of the entire federation with framework in place for regular updates. We have been able to assist the 36 states and Federal Capital Territory to establish debt management departments. We have strengthened the legal and institutional framework for debt management in the states,” he said.
The DG pledged to sustain the country’s presence in the international capital market through the issuance of $1 billion Eurobond, N80 billion FGN bonds and $ 100 million Nigerian Diaspora bond.
Nwankwo allayed fears of over borrowing in some quarters, saying that whatever bond DMO is issuing on behalf of the government is part of the was contained in the 2013 budget.