FG Will Not Publish Details Of $5bn Abu Dhabi Loan – Oyedele

The Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, has rejected calls for the Federal Government to publish details of how it plans to spend funds drawn from its $5bn financing facility with First Abu Dhabi Bank. He recently had his say while speaking to the press, and Nigerians have been reacting.

Stressing that the transaction has been subjected to unnecessary scrutiny, Oyedele argued that the facility was approved by the National Assembly and was structured to help the government refinance more expensive debt.

Questioning why the particular facility was receiving special attention, he added that the FG would publish information on how it spends government money.

His words, “We will not publish how we are spending it. We will publish how we spend government money. There’s nothing special about that loan.

Nobody has asked us whether we’re going to publish the money we took from the World Bank, whether we publish the one from Eurobond, whether we publish the one from Sukuk. Why is this one special?

The loan was approved not only by FEC, it was taken to National Assembly because what some people are doing is they comparing with other countries where they did it under the table.

What else can be more public than what you gave to the National Assembly?

We’re assessing it in phases. You don’t want to take all the money at once because if you don’t spend it at once, you incur cost on the extra amount you’ve taken

You need to understand the transaction. You know, there’s always the textbook analysis and there’s the real life of what you’re doing.

So, we’re used to raising bonds on fixed interest rate terms. You see, I can tell you our Eurobond, for example, they were raised when the coupon was double digits. Today, our yield is down to around seven, 7.5 per cent.

This First Abu Dhabi Bank transaction is flexible rates. It means if rates go up, we pay more. If rates come down, we benefit more.

There’s nothing that says we must always do one thing. And the all-in rate for this transaction is lower than our existing portfolio.

So the objective is to use it to refinance expensive debt so you can save money.

In the next few days, you will see on the website both the Ministry of Finance and DMO the frequently asked questions about this particular debt or bond, just so everybody can please themselves.

I spend time on it because I think it’s important and the international media also, for some reason, have taken so much interest in it. But that is what it is.”