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Click herePresident Bola Tinubu has submitted a proposal to the National Assembly seeking approval for $2.3 billion in new foreign loans and authorization to issue a $500 million sovereign sukuk in the international debt markets. The goal is to raise a combined $2.8 billion.
The new borrowing will help finance the 2025 budget deficit, supporting government spending amid revenue shortfalls.
A portion will be used to refinance maturing Eurobonds in November, preventing default pressure and managing Nigeria's debt rollover risk.
The government is exploring cheaper funding options such as green bonds, sukuk, and diaspora bonds, which it views as more cost-effective alternatives to Eurobonds.
The $500 million sukuk would mark Nigeria's first sovereign debt issuance under Islamic finance principles in global markets.
Nigeria has previously issued domestic sukuk (in naira) for infrastructure projects, which have seen strong investor demand. Ecofin Agency
The international sukuk could be issued with or without credit enhancements from institutions like the Islamic Corporation for the Insurance of Investment and Export Credit (ICIEC).
Nigeria reentered international capital markets in late 2024 after a hiatus of nearly three years, but it has not accessed new foreign debt in 2025 yet.
The Tinubu administration has implemented reforms (fuel subsidy removal, exchange rate unification, fiscal adjustments) which have improved investor sentiment and led to positive rating agency assessments.
Nigeria's domestic sukuk program has been oversubscribed, indicating strong demand in local markets—this success provides a base for confidence in global issuance.
The planned issuance is part of a broader strategy to diversify Nigeria's debt instruments, reduce reliance on high-cost Eurobonds, and tap into Islamic finance markets in the Middle East and Asia.
