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Federal Govt to use $2.2 Billion from Eurobond Money for Petrol Subsidy

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The Federal government of Nigeria will draw $2.2 billion this month (March) or next month (April) from the money acquired from a Eurobond issuance last year September and incorporate the proceeds if fresh domestic borrowing this year to fund petrol subsidies as oil prices hike, Zainab Ahmed, the Minister of Finance has stated.

Mrs Zainab Ahmed explained that Nigeria will not analyze the Eurobond market in 2022, echoing a declaration initial made by the office of the head of country’s debt, Patience Oniha.

Soaring fuel prices has put us in a very dangerous situation because we import refined commodities and it means that our subsidy fee is really increasing

This January, the government flew down from a previous pledge to stop a subsidy routine, opting to lengthen it by a year and a half in order to forestall a possible civil hostility in the introduction to the next year (2023) presidential election.

Petrol subsidy expenditure spent N10trn in the 12 years to 2018, according to Dataphyte investigation house and data analytics company, over eight-time what all the 36 states generated for 2020.

Nigerian National Petroleum Company (NNPC) would need N3 trillion from Nigerian govt for this year’s subsidy spending.

Africa’s largest oil producer depends almost wholly on imported petrol to meet local demands and has been confronting weeks of dire petrol shortage after receiving unusable substandard fuel from suppliers abroad.

According finance minister, the federal government is in discussions with the delegation to ramp up payments. She also stated the hike in petroleum prices indicates borrowings will exceed earlier prediction.