FG approves $2.9b Euro Bond to fund 2018 budget

THE Federal Executive Council (FEC) on Wednesday approved $2.9billion Euro Bond that will help finance its external borrowing plans of $2.76billion to fund the 2018 capital budget.

Minister of Finance, Zainab Ahmed, who disclosed this while briefing State House correspondents on the outcome of the meeting presided over by President Muhammadu Buhari at the presidential villa, Abuja, said FEC also approved the request to raise $82.54million to bridge the shortfall in the $500million Euro Bond that matured in July 2018.

She said: “We also got approval for transaction parties for their fees and expenses. There are five parties in the transactions, two joint lead managers, with a combination of three banks.

“The banks include Standard Chattered Bank, FSDH Marchant Bank, White and Case LLP, who are acting as Legal Advisers, (foreign) and Banwo and Ighodalo, as Legal Advisers, (local).”

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The Minister said FEC also granted approval for contracts to Africa Practice as technical advisers on communication, adding that the six advisory contracts were procured at the total cost of N374.8million.

Also approved by FEC according to the Minister is the sum of $60million loan for the Livelihood Improvements Family Enterprise Project for the nine of states of the Niger Delta.

She explained that loan will come in form of grant and its implementation will take off in six of the nine states minus Akwa Ibom, Rivers and Imo which are yet to meet the requirements for the implementation of the project.

She said the federal government is working with the three states to provide them with technical support to enable them to satisfy the requirements for the loan.

She said: “Six states met the requirements, but three did not. So, the three states that did not meet the requirements will be assisted with technical support to enable them improve on their public procurement and financial management services to enable them meet the requirements.

“The states that were not paid were Akwa Ibom, Rivers and Imo State because they had some deficiencies and the agency that is handling it is working to bridge the gap.

“The Federal Ministry of Agriculture and Rural Development and the Niger Delta Development Commission (NDDC), will be the lead implementing Agency.”

The minister revealed that even though President Buhari had given approval for the payment of the third tranche of Paris Club refund to states, some states cannot be paid because they had not met the conditions attached.

She stated: “In respect of the Paris Club, Mr. President has given approval for the payment of the last Paris Club refund to the states but the approval came with some conditions which we are trying to work out together with the states to meet.

“Those conditions that Mr. President gave is that we must show that the states have used the previous refund for payment of salaries and they will use this one also for payment of salaries.

On the shortfall in the approved money paid to former Nigeria Airways staff, the minister informed that there was no money to pay the N45 billion as approved by the president, noting however that government plans to pay the balance in 2019.

“The approval given for payment of entitlements to the ex-staff of Nigeria Airways was N45 billion and because of paucity of funds, Mr. President gave approval for the payment of 50 per cent of N22.6 billion. We hope in 2019, to pay the balance,” she explained.

In his remarks, Minister of Agriculture and Rural Development, Audu Ogbe, said FEC also approved the disbursement of produce processing Machines to farmers in the rural areas to boost agriculture amongst rural people.

He said the project named “Take life to the villages,” will involve the supply of processing machines for rice, cassava and processing of other local produce, depending on what each community has the capacity to produce.

While he regretted that most people cannot access bank loans, he said the project was being executed in partnership with the Ministry of Finance.

“We will Identify commodities in various locations, identifying what is suitable in each area, according to their ecological situation, organize the people into cooperatives and allocate the machines to them as loans,” he said.