Reuters has reported that Nigerian Finance Minister Kemi Adeosun plans to travel to China next week, aiming to negotiate a loan of up to $2 billion to help fund record budget spending, financial and government.
It also reported that Nigeria, which is suffering its worst economic crisis for decades, has shelved plans to meet investors about returning to commercial borrowing on the Eurobond market.
One Nigerian government official revealed that any loan agreed during Adeosun’s trip could be signed by President Muhammadu Buhari in Beijing next month.
“The finance minister, in the company of the central bank governor, is scheduled to be in China sometime next week to conclude negotiations on the $2 billion loan,” said the official.
The official acknowledged negotiations had been underway for some time and that the terms had yet to be agreed. However, he added: “Hopefully it may be sorted out during this meeting and the loan will be signed during President Buhari’s visit to China in March this year.”
Nigeria needs to raise about $5 billion abroad to cover part of its 2016 budget deficit. This is projected to hit 3 trillion naira ($15 billion) due to heavy infrastructure spending at a time when the slump in global oil prices has slashed it export revenues.
Nigeria had wanted to raise $1 billion from Eurobond investors but has dropped plans to sound them out at a non-deal “road show” which the finance ministry had tentatively planned for March, financial sources say.