Nigeria returns to Eurobond market with $2.3bn issuance

Nigeria is set to re-enter the international debt market this week with plans to raise $2.3 billion through a Eurobond issuance — its first since December 2024 — despite recent geopolitical jitters following U.S. President Donald Trump’s remarks on the country.

According to Bloomberg, the Federal Government intends to issue 10-year notes alongside 15- or 30-year securities, pending final approval from the Ministry of Justice.

The move reflects Nigeria’s confidence in renewed investor appetite for emerging-market debt, even as global investors weigh political and security risks.

Nigeria joins Kenya and Angola in tapping the Eurobond market this year, taking advantage of strong global liquidity and expectations of U.S. interest rate cuts, which have boosted demand for high-yield African assets.

Data from JPMorgan Chase & Co. shows that the average spread on African sovereign debt over U.S. Treasuries has narrowed to 367 basis points — nearly half the April level.

The $2.3 billion issuance, approved by the National Assembly, comes alongside plans to raise an additional $500 million through sukuk Islamic bonds before year-end.

The sale was briefly delayed after President Trump accused the Nigerian government of failing to protect Christians and threatened to cut off U.S. aid, triggering a short-lived selloff in Nigerian assets. President Bola Tinubu swiftly dismissed the claims, reaffirming on X that Nigeria “has constitutional guarantees to protect citizens of all faiths.”

Investment banks Chapel Hill Denham, JPMorgan Chase & Co., Standard Chartered Plc, Citigroup Inc., and Goldman Sachs Group Inc. have been appointed as joint lead managers for the Eurobond, while FSDH Merchant Bank Ltd. serves as financial adviser.

Nigeria’s 2051 Eurobond has fallen by about one cent to 91.05 cents over the past two days, pushing yields to 9.14%, still well below the April peak of 12.11%.

Since assuming office in May 2023, President Tinubu has implemented major market reforms — scrapping fuel subsidies, overhauling the tax system, and allowing a more flexible naira exchange rate. These measures have drawn investor confidence and led Moody’s Ratings to upgrade Nigeria’s sovereign credit rating from Caa1 to B3, citing “significant improvements in external and fiscal positions.”

The rating boost positions Nigeria closer to rejoining the pool of emerging markets considered investable by major global funds.

Nigeria is also preparing to meet two major debt obligations before the end of 2025 — a $1.12 billion Eurobond and a ₦100 billion sukuk bond. The 7.625% Eurobond, issued in November 2018 and maturing on November 21, 2025, remains a key component of the nation’s external borrowing strategy aimed at financing infrastructure and supporting foreign reserves.