Nigeria’s government raised $900 million through its first-ever domestic dollar bond sale, aiming to diversify funding sources amid high yields in international capital markets.
The five-year bond, issued with a 9.75% coupon, was oversubscribed by 180%, reflecting strong demand, according to the Africa Finance Corporation (AFC), which coordinated the issue.
This bond sale provides much-needed hard currency for Nigeria, which has struggled with severe dollar shortages, prompting two naira devaluations in less than a year. The proceeds will be invested in critical sectors of the economy, though further details were not provided.
The success of the bond highlights the advantages of tapping into Africa’s domestic capital markets for financing development.
In August, Africa’s most populous country unveiled a plan to raise $500 million from domestic investors as part of an initial fundraising effort, with an ultimate goal of securing $2 billion.
The nation is opting to issue US-currency bonds within its borders to address infrastructure financing gaps, as the government cites unfavorable market conditions for a Eurobond offering.
