Nigeria says it is not restructuring its debt, can meet obligations

PUBLISHED: Fri, 14 Oct 2022 08:20:10 GMT
Karin Strohecker, Rachel Savage and Libby George
homeZainab Ahmed, Nigeria’s former finance minister, speaks during a Bloomberg Television interview during the Emerging + Frontier Forum 2019 at Bloomberg’s European headquarters in London, U.K., on Tuesday, June 25, 2019. Rocked by trade disputes, the possibility of a U.S. recession and the ever-present threat of political conflagration, the backdrop for emerging and frontier markets has rarely seemed less settled. Photographer: Luke MacGregor/Bloomberg via Getty Images

LAGOS, Oct 13 (Reuters) – Nigeria is not restructuring its debt, the country’s Debt Management Office (DMO) said in a statement on Thursday.

The country is exploring bond buy-back and bond exchanges to manage its debt liability, the office said in the statement, and it assured investors and creditors that it would “meet all its debt obligations.”

On Wednesday, Bloomberg news quoted Finance Minister Zainab Ahmed as saying the country was exploring debt restructuring, but the DMO said her comments were taken out of context.

Instead, the DMO said Nigeria is spreading out debt maturities and refinancing short-term debt using long-term debt instruments.

Nigeria’s total public debt rose 3% to $103.3 billion in the second quarter of this year, driven largely by burdensome fuel subsidies and falling oil revenue due to crude theft.

The cost of servicing that debt surpassed revenue in the first four months of this year, worrying many observers.

Nigeria’s international dollar bonds had suffered sharp declines in recent days, with longer-dated issues dropping more than 2 cents in the dollar on Thursday, MarketAxess data showed.

Many of the country’s bonds trade in distressed territory below 70 cents in the dollar with the 2047 bond being bid at 55 cents, almost half its face value. XS171701309=1M, XS191082818=1M

(Reporting by Karin Strohecker, Rachel Savage and Libby George; editing by Jonathan Oatis and Sandra Maler)

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