The Nigerian government plans to issue $2.3 billion in Eurobonds before the end of 2025 to support budgetary funding and carry out liability management operations, according to an update from CSL Stockbrokers.
The firm noted that a $1.1 billion Eurobond is due to mature in November, which may necessitate fresh borrowing to meet Nigeria’s external debt obligations.
According to CSL, the planned issuance would mark Nigeria’s return to the international debt market following the successful $2.2 billion Eurobond sale last December, which was nearly four times oversubscribed.
“This planned issuance aligns with our earlier view that Nigeria could return to the market before year-end to raise at least $2 billion,” CSL said.
In August, the firm’s analysts had projected that a potential U.S. Federal Reserve rate cut could encourage Nigeria to issue new Eurobonds.
“In terms of structure, we maintain that the authorities are likely to opt for a 10-year amortising Eurobond, taking advantage of the yield gap between the 2034s and 2038s on the curve,” the firm explained.
On pricing, CSL noted that market conditions remain favourable, with yields on Nigeria’s Eurobond curve declining by an average of 168 basis points year-to-date.
“We expect strong investor demand, supported by growing confidence in Nigeria’s economy following recent reform measures and the global trend towards lower interest rates, which continues to boost appetite for emerging market assets,” the firm added.
In addition to the planned Eurobond, reports indicate that Nigeria is considering a foreign Sukuk issuance valued at approximately $500 million.
CSL said this aligns with expectations that the government may accelerate the issuance of non-conventional instruments such as green or sustainable bonds — a growing trend among Sub-Saharan African sovereigns seeking access to ESG-linked financing at relatively lower costs.
The firm noted that such instruments typically attract dedicated pools of capital from global investors focused on sustainability and responsible investing, helping Nigeria diversify its funding sources while strengthening its ESG profile in the global debt market.
“We expect the planned issuances to support external reserve accretion, which has been on an upward trend in recent months, with the 30-day moving average rising to $42.6 billion as of October 7,” CSL said.
“The anticipated inflows should also enhance liquidity in the foreign exchange market, supporting both stability and continued appreciation of the naira. However, since the proceeds will likely be used for fiscal operations, the borrowings could add short-term pressure to the fiscal deficit,” it added.
