The Federal Government, through the Debt Management Office, on Wednesday announced plans to issue N500 million dollars local bonds to boost dollar liquidity.
The Minister of Finance and Coordinating Minister of the Economy, Wale Edun, said this on Thursday in Lagos at an investor meeting for the bond issuance.
Edun assured Nigerians that the economy was on the trajectory of growth, adding that dollar funding was critical for the exchange rate to stabilise .
According to him, in terms of investments and stabilising the economy, it is important to have adequate foreign exchange.
He said that though there had been improvements in the flow of foreign exchange into the economy, the dollar denominated bond would further boost FX liquidity.
He said that this transaction was aimed at improving the external reserves and supporting the exchange rates, which were critical elements of stabilising the economy and preparing it for investment and growth.
“The flow of dollars has improved into the economy from portfolio investors, from foreign direct investment and from multilateral mobilisations, which have bought into the government’s macroeconomic reforms.
“This transaction plays an important role in this process because we have a domestic issuance of dollar bonds aimed at further improving the inflow of dollars.
“The more the foreign exchange, the higher the foreign reserves, the stronger would be the exchange rate. That gives a chance for inflation to come down.
“The lower the inflation, the lower the exchange rate,” he said.
Edun said that the economic reforms started by President Bola Tinubu were already yielding fruits.