Finance Minister Zainab Ahmed has said that loans taken from the Central Bank of Nigeria to fund budget deficits amounting to NGN20trn (US$45.4bn) will be converted to bonds over a 40-year period at an interest rate of 9 percent.
President Muhammadu Buhari has approved the plan to convert the loans. According to the head of the country’s Debt Management Office, “it is a one-time restructuring payable over 40 years with a moratorium”. The timing of the conversion will be disclosed after the government seeks approval from the cabinet and lawmakers this year. This is the first time Nigeria has resorted to such a move, and it comes as pressure mounts on Nigeria’s public finances.