Debt and Development Issues
Nigeria redeems N482million external debt
Jun 2, 2003, 18:16
| | Nigeria’s monthly external debt of N500million, which is usually offered for sale through the Debt Conversion Programme (DCP), was redeemed for N482.9million at the 147th debt auction that took place on 30 May 2003.
A single creditor redeemed the amount (representing 86 per cent of the total volume of debt (N500million)) at the rate of N126.82 to one United States (US) dollar.
Since the introduction of the DCP in November 1988, it has recorded relative success with about $1.5million of the country’s debt redeemed by 687 creditors.
Contrary to investors’ apathy towards the parallel market differentials in the official exchange rates of N127.82 and N139 to one US dollar, the successes recorded in the last two months have allayed such fairs.
The DCP was established in 1998 as a means of pruning down Nigeria’s debt obligations. Through the Programme, investors are expected to buy debt coupons for equity investment in the country. Subsequently, the Central Bank, in line with the liquidity situation in the economy, would release required funds.
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