Nationwide Shock!!! Buhari Begs For N450 Billion, Despite Billions Of Recovered Looted Funds

By Amako Nneji January 7, 2017 18:54

Nationwide Shock!!! Buhari Begs For N450 Billion, Despite Billions Of Recovered Looted Funds

In an attempt to avoid the situation that hampered the execution of Nigeria’s 2016 budget, President Muhammadu Buhari, has concluded plans to borrow about N450 billion, internally, to sponsor the 2017 budget.

While the 2016 suffered a deficit of N2.2 trillion, the 2017 proposed budget has an in-built N2.3 trillion, made up of N1.54 trillion external loan, and N890.06 billion internal loans.

The loan which is to be internally sourced through sale of treasury bills and bonds, with the collaboration of the Central Bank of Nigeria, CBN, and the Debt Management Office, DMO, is to be executed in three auction tranches.

According to the data released on Friday, January 6, by DMO, the first auction of N140 billion bonds, is to mature in 2021, and N105 billion in debts, to mature in 2026, all of which are to be held between February and March 2017.

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The second batch will see the CBN supervising the sale of N55 billion in bonds, which will mature in 2027, and another bond valued at N130 billion, whose maturity is billed for 2036.

Recall, that Nigeria up till date has been finding it difficult to fund the 2016 budget, with major external loans not accessible, while a planned $1 billion Eurobond programme, is yet to kick off.

It would be recalled, that the CBN, had on Wednesday, sold N172.85 billion ($550 million) of its first Treasury bill, as part of its commitment to the execution of the 2016 budget.

To encourage patronage, the apex bank said subscription details of the bills would be made public early enough, with needed assurance of redemption at maturity.

CBN usually issues Treasury bills regularly to help lenders manage their liquidity, curb rising inflation, and provide naira, to help the government fund its budget.

The apex bank had in 2016 alone, issued a total of $500 million worth of Treasury bills, with yields made to be attractive to investors.

However, Dr. Solomon Ezomon, a Business Administration Lecturer, at the University of Lagos, said that use of financial instruments in an economy undergoing recession, is the last resort to measures aimed at quick recovery.

“Treasury bills and bonds help in a buoyant economy, to mop up excess money in the system, but with recession known to have indication of less money in circulation. However, if the treasury bills and bonds sales are harnessed well, the process can help in funding the 2017 budget no doubt.”