Nigeria ‘can easily get loans’

Nigeria will easily achieve its target of $3.5bn foreign borrowing in 2017 as improved oil output helps the economy to recover from 2016’s contraction, the first since 1991, Moody’s Investors Service said.

“The international financial institutions are ready to support Nigeria,” Aurelien Mali, a vicepresident and senior analytical adviser for Africa at the ratings company, said on Wednesday.

“As long as it is project-based lending, the funding will be available from lenders such as the African Development Bank, and the budget support from the World Bank will come on top of that,” he said.

Nigeria has proposed a record 7.3-trillion naira ($23.1bn) budget for 2017 to boost infrastructure investment and help its economy recover from a contraction of 1.5% in 2016, the first such slump in 25 years.

The economy was weighed down by a decline in the price and output of oil, its biggest export, which led to a shortage of dollars.

The government has been negotiating $1.25bn in budget support from the World Bank and expects to get the remaining $400m of a $1bn credit facility from the African Development Bank, Mali said.

Nigeria can raise the rest from bilateral and multilateral partners and also from lenders through commercial loans and or even a sukuk bond, he said.

Moody’s rates Nigeria’s debt at B1, four levels below investment grade.

AS LONG AS IT IS PROJECT-BASED LENDING, THE FUNDING WILL BE AVAILABLE FROM LENDERS