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Nigeria Successfully Repays $500 Million Eurobond Borrowed Under Jonathan
President Bola Tinubu's administration has successfully paid back a $500 million Eurobond loan. The loan was originally borrowed by the government of former President Goodluck Jonathan in 2013. On July 12, 2023, the Debt Management Office confirmed that the debt was repaid on its due date.
The Nigerian government, under President Bola Tinubu, has successfully repaid a $500 million Eurobond loan that was taken by the previous government led by former President Goodluck Jonathan a decade ago. The Debt Management Office released a statement in Abuja on Monday, revealing that the Eurobond was paid on Wednesday, July 12, 2023, in accordance with the agreed repayment schedule.
Eurobonds are debt instruments issued in a currency other than the home currency of the country or the market in which it is issued. According to the DMO, the successful repayment of the Eurobond demonstrates Nigeria's commitment to fulfilling its debt obligations. The DMO stated, "The Eurobond was issued in July 2013 (as part of a dual-tranche USD1 billion Eurobond) with a tenor of ten years and a coupon of 6.375% per annum."
"The repayment of this Eurobond, along with the previous redemption of a $500 million Eurobond in July 2018, another $500 million Eurobond in January 2021, and a $300 million Diaspora Bond in June 2022, brings the total amount of securities redeemed by Nigeria in the International Capital Market (ICM) to $1.8 billion. Nigeria's successful redemption of Eurobonds and Diaspora Bond in the ICM over the past six years showcases its strong debt management operations and planning," added the DMO.
It is worth noting that Nigeria's public debt has increased to N82 trillion from N77 trillion prior to the Central Bank of Nigeria's exchange rate unification, which was announced on June 14, 2023. The unification resulted in the devaluation of the naira to N664 per dollar and had adverse effects on the country's economy, including a surge in public debt.
President Bola Tinubu's government will embark on its first debt-servicing this July, repaying a $500 million Eurobond as Nigeria continues to face economic challenges. According to data from the Debt Management Office (DMO), the repayment is in line with the loan's conditions. The Nigerian government obtained the loan five years ago at an annual interest rate of 6.375%.