Government plans $2.5b Eurobond to bridge budget deficit as FG, states share N637b revenue
The Debt Management Office (DMO) has unfolded plans by the Federal Government to float a Eurobond worth $2.5 billion before the end of 2017.
The borrowing is expected to bridge the deficit in 2017 budget currently facing liquidity issues due to inability to finance of some capital projects.
The Director-General of DMO, Patience Oniha, at the 2017 Nigerian Debt Capital Markets Conference & Awards in Lagos yesterday explained that the proposed eurobond would complement the $1.5 billion raised from the international market in March 2017.
According to her, government also plans to refinance the nation’s treasury bills portfolio currently stood at N3.7 trillion with foreign borrowing to reduce pressure on the domestic market.
Meanwhile, money shared by the three tiers of governments in the country at the monthly Federation Accounts Allocation Committee (FAAC) increased by about N170 billion.
Yesterday, at the FAAC meeting where the last August revenue generation was declared for adoption and distribution, the Minister of Finance, Mrs. Kemi Adeosun, represented by the Accountant – General of the Federation, Alhaji Ahmed Idris, said there was an improvement in all the revenue stream windows.
The net distributable revenue generated for the month of July for the three tiers was N467.8 billion, whereas the August collections for which distribution was done yesterday is N637.704 billion.
This improvement nevertheless, the figure still falls below the N700 billion monthly target set by the government as minimum distributable amount penultimate week by FAAC monthly to avert slipping back to recession.
Briefing newsmen after the FAAC meeting yesterday, the Accountant-General of the Federation(AGF) Ahmed Idris, reported that the gross statutory revenue for August 2017 was N550.992 billion as against N387.319 billion received in July, indicating an increase of N163.673 billion.
The AGF also reported that revenue available from the Value Added Tax (VAT) for August 2017 was N86.712 billion as against N80.533 billion in July 2017, resulting in an increase of N6.179 billion. He said Companies Income and Petroleum Profit Taxes as well as Import and Excise Duties also recorded significant increases.
He said the country recorded an increase of $41 million in crude oil sales notwithstanding the decrease in the average price of crude oil from $51.05 to $50.44 per barrel. This increase, according to him, resulted largely from the significant increase in export volume by 0.85 million barrels.
Idris stated further the improvement revenue was a result of I improvementt in the operating environment in the Niger Delta.
A breakdown of the distribution shows that the Federal Government received N273.095 billion; the State Governments received N173.806 billion and the Local Governments got N131.044 billion. The oil producing states received N41.977 billion as 13 per cent derivation revenue while the revenue generating agencies were given N17.782 as cost of collection.