The Director-General, Debt Management Office (DMO), Patience Oniha said yesterday that the International Capital Market has closed its doors to Nigeria, making it impossible for the country to borrow money from the Euro bond market to fund government projects.

Oniha, who spoke while defending the agency’s 2023 budget before the House Committee on Loans and Debt, also said that the Nigerian government has so far spent about N1.2 trillion  on loans taken from the Central Bank of Nigeria.

She also told the Committee that the nation’s external reserve stands at about $37.49 billion, adding however that the information is always available on the website of the Central Bank of Nigeria.

While speaking on the processes of raising money for the government to finance the budget, Oniha said “the reality is that if it was before, by now, we would have issued Eurobonds to raise the money. But from the fourth quarter of last year, the International Capital Market has not been opened to countries like Nigeria.

“In 2021, there was N6 billion to be raised, but we raised N4 billion out of that. This year, we raised N1.25 billion. That was the only day the International capital market was opened. Since January this year, countries with our rating, the international market are not looking for us because the invasion of Ukraine by Russia turned things around the world significantly.

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“So, inflation rates are high, interest rates are high and investors are saying there is a lot of uncertainty, there is threat of recession. So, what they have decided to do is to put their money in the G7 nations.

“Interest rates there have gone up significantly and monetary policy has raised interest rates across the world and foreign investors are happy to invest in those nations. Right now, they don’t know what will happen with us and we have not issued any Euro bond this year because the market has not opened”.

Responding to a question on why the market was closed to Nigeria, she said “the International Capital Market is not close only to Nigeria. Foreign investors are huge, but they have a limit to the amount of risk they can take. You have Fitch and others rating countries.

“The very strong countries are the ones that in triple A and USA used to be part of triple A and I think they have been brought down to double.

It is not only Nigeria, but the whole of Africa. For this year, it is only Nigeria and Egypt that were issued a Euro bond. It is the same with some of the South American Countries because we have the same rating.

“The ratings give the investors the perception of how risky you are. Investors are now putting their money in securities issued by the US government, Japan, France and others because they know that those countries will pay. We were even lucky to raise money in March”.