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By Felix Onuah and Chijioke Ohuocha
ABUJA/LAGOS, March 29 Nigeria raised $500
million by issuing a 15-year Eurobond on Wednesday with a yield
of 7.5 percent, the finance ministry said, helping it plug a
huge budget deficit in Africa's largest economy.
To revive the economy, which slipped into recession last
year for the first time in 25 years, the government plans to
increase spending by almost 20 percent this year, leaving it
with a budget shortfall of 2.36 trillion naira ($7.7 billion).
The money from the new bond, which follows an oversubscribed
$1 billion Eurobond issue last month, will help fund
infrastructure development work outlined in last year's budget,
Finance Minister Kemi Adeosun said.
"The proceeds from this additional note issuance will go
towards funding capital projects in the 2016 budget," she said.
Nigeria has been hit by a slump in global oil prices, which
has reduced government revenues and battered its naira currency
The government plans to spend a record 7.3 trillion naira
($24 billion) this year to help get the country out of
recession. It planned to spend 6.1 trillion naira last year, but
struggled to fund its budget.
Nigeria's February $1 billion Eurobond issue, set to mature
in 2032, priced at 7.875 percent and was almost eight times
The slightly lower yield the government will pay on
Wednesday's issue may be an indication of the strength of demand
for Nigerian debt overseas.
The country has registered a $300 million Diaspora bond
programme, targeted at Nigerians abroad, with the U.S.
Securities and Exchange Commission and is seeking at least $1
billion in loans from the World Bank and a $1.3 billion loan
from China to fund railway projects.
The country is also planning a 20 billion naira "green bond"
next month after a new savings bond this month targeted at
retail investors to broaden its funding base.
($1 = 306.6500 naira)
(Writing by Paul Carsten and Alexis Akwagyiram; Editing by Hugh