The Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, has confirmed that Nigeria has received the first $1.5 billion from its $5 billion financing deal with First Abu Dhabi Bank (FAB).
Mr Oyedele shared this news while speaking with journalists after the Federal Executive Council (FEC) meeting in Abuja on Monday.
He explained that this financing is meant to help refinance expensive debts, fund infrastructure projects, and support the implementation of the budget.
“The approval for that loan went to the National Assembly, so everybody is aware of it. It’s for refinancing of expensive debts, financing of infrastructure, as well as budgets,” he said.
He also mentioned, “So, we don’t want to start making press releases each time we do a drawdown. It is not different from any other loan.”
The minister’s comments mark the first official confirmation that the government has started using the financing package.
Last week, Bloomberg reported that Nigeria had accessed about $1.5 billion through a Total Return Swap with First Abu Dhabi Bank. This marks the first use of the larger $5 billion facility.
Mr Oyedele stated that the government set up the financing arrangement to allow funds to be accessed in parts instead of all at once.
He said, “The loan is meant to be a drawdown in tranches, and one of the advantages of that is, if you need $5 billion and you take everything at once, you start paying interest, even though you’re not spending all of it now. So, this has been structured in a way that makes us even more efficient in the cost of borrowing by taking what we need part time.”
Mr Oyedele explained that this step is part of the government’s bigger plan for managing debt. The goal is to lower borrowing costs while still meeting important funding needs.
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