Can Eurobonds plug Nigeria's foreign currency crisis?
Eurobonds. Source: StearsBusiness
Get smarter with your team today and enjoy a 10% discount on a Corporate Subscription! (Offer valid until August 25th)

 

Back in 2017, when I was still teething as a newbie economist, a particular form of government borrowing caught my attention.

Eurobonds.

The exciting link to a certain fictional British spy aside, I was keen to understand how borrowing from international markets will affect a country's economy. Who were the entities rich enough to lend entire countries this money? What will the debt cost the country? How long do governments typically have to pay back? And ultimately, how can the Nigerian government prove to foreign investors that the country is worth lending to, considering the country's weakening currency.

We would be getting to the answers to these questions in a bit. But before I go into all of that, let's start with another question.

 

Why are we talking about this now?

Eurobonds have had popular moments among African countries. These countries typically have a high borrowing appetite for funding large-scale government projects like infrastructure. Essentially, eurobonds offer

This story is only available to Premium subscribers Subscribe or sign in to finish reading

Not ready to subscribe? Register to read a selection of free stories

Fadekemi Abiru

Fadekemi Abiru

Read Latest

How Nigerians are buying assets from Shell and ExxonMobil

PREMIUM - 17 MAY 2022

Why closing Nigeria's land borders was a mistake

PREMIUM - 16 MAY 2022

What Emefiele's scorecard says about his Presidential ambitions

PREMIUM - 13 MAY 2022

Why is Google building internet infrastructure for Nigeria?

PREMIUM - 12 MAY 2022