Improving Public Debt Management
In the OIC Member Countries
118
IBTC Plc. and the Jaiz Bank Plc. (Sapovadia 2015, Oladunjoye 2014). At the beginning of 2016
the SEC and the DMO agreed to cooperate in order to issue Nigeria’s first sovereign sukuk and
in October 2016 the Nigerian central bank published guidelines to specify the granting of sukuk (SEC 2016, CBN 2016). The DMO plans a first issuance of a sovereign sukuk in 2016/2017, in
line with the MTDS 20162019.
Figure 4-21: Nigeria - Yield Curve of FGNs
Source: DMO (2015, p. 56).
Domestic debt marketSince 2005, government budget deficits have been mainly financed by domestic borrowing in
the bond market (Central Bank 2013). Domestic creditors are the central bank (holding 9.9%
of domestic debt), banks (37.2%), nonbank public (51.1%) and the Sinking Fund (1.8%). Nonbank public creditors are mainly pension funds, government agencies, nonbank financial
institutions and insurance companies.
The government plans to introduce Retail Bonds, Inflationlinked Bonds and sukuk on the
domestic debt market.
Foreign borrowingThe share of external debt (defined as debt denominated in foreign currency) in total debt was
low at 19.8% in 2015. The external debt portfolio is composed of 73.5% of U.S. Dollars, 16.9%
of SDRs, 1.1% of Euro, 8% of other currencies in 2014 (see Figure 419).25 Main creditors are
IDA/AfDB holding 65% of external debt and IBRD/ADB holding 4% of external debt. Bilateral
creditors (China EXIM Bank, French Development Agency, Japan International Cooperation
Agency and Kreditanstalt fuer Wiederaufbau) hold 15% of external debt. Eurobonds constitute
14% of external debt (see Figure 422). 82.2% of external debt is concessional (DMO 2015).
25 Values taken from the World Bank. The MTDS describes the following currency composition in 2015: 38.3% U.S. Dollars,59.6% SDR, 1.2% Euro.