The Federal Executive Council (FEC) on Wednesday approved moves to restructure Nigeria’s debt profile by borrowing less in naira but more in foreign currencies.
The Minister of Finance, Kemi Adeosun, briefed State House correspondents at the end of FEC meeting.
She said the government is also refinancing treasury bills.
Adeosun said: “The memo that I presented was approved by council as part of efforts to restructure our debt portfolio. We got an approval in June to restructure our debt profile. We will borrow less in naira and more in foreign currency because it’s cheaper and we want to prevent crowding out of the private sector. We want to create room for the private sector so that they can borrow and create more jobs.
“So as part of that, we sought approval and that was granted for us to refinance treasury bills. We will finance treasury bills as treasury bills mature. We will be financing them in dollars and up to $3 billion worth of treasury bills will be refinanced into dollars.
“As the naira treasury bills mature, we will be issuing dollar instrument. We are not increasing our borrowings, but simply restructuring. Instead of owing naira we will be owing dollars and the advantage to that one is cost reduction. The average rate we borrow internationally doesn’t exceed 7 per cent. Our treasury bills were paying between 13.6 and 18.5 per cent.”