Nigeria has made a bold return to global capital markets with a $2.25 billion dual-tranche Eurobond issuance that surpassed expectations. The 10-year and 20-year bonds, priced at 8.625% and 9.125% respectively, were heavily oversubscribed, signaling strong investor confidence in the country’s economic and fiscal reforms. Analysts say the robust demand underscores a renewed trust in Nigeria’s macroeconomic policies and positions the country as a credible participant in international financial markets.
The surge in Eurobond interest has been largely attributed to the Central Bank of Nigeria’s (CBN) bold foreign exchange reforms. Since 2023, under Governor Olayemi Cardoso, the CBN has liberalized the FX market, eliminated central bank financing of the fiscal deficit, and reformed fuel subsidies. These measures, coupled with improved fiscal transparency and growing foreign reserves, have reassured investors, making Nigerian debt an attractive option amid global market uncertainties.
Global investors flocked to Nigeria’s Eurobond, creating an order book that exceeded $13 billion—almost six times the value of the issuance. Participation came from Europe, North America, Asia, and the Middle East, alongside domestic investors. Experts say the oversubscription reflects broader confidence in Nigeria’s economic trajectory, strengthened by the country’s removal from the FATF grey list and upgrades from rating agencies, signaling a better risk outlook for frontier markets.
The successful issuance also had immediate positive effects on Nigeria’s currency and financial markets. Following the Eurobond launch, the naira appreciated slightly, while foreign reserves reached a seven-year high of $46.07 billion. Analysts note that these developments, combined with reduced inflationary pressures and coordinated fiscal-monetary policies, have created a more stable investment environment, boosting confidence among both domestic and international stakeholders.
Nigeria’s Eurobond success is more than a financial milestone; it represents a turning point for the country’s economic credibility. By combining structural reforms, transparent fiscal management, and strategic engagement with global investors, Nigeria is not only strengthening its fiscal position but also laying the foundation for long-term economic growth. Experts agree that sustaining currency stability, fiscal discipline, and inflation control will be critical to maintaining investor confidence and delivering tangible benefits to Nigerians.
source: The sun