Nigeria has commenced discussions with the Islamic Development Bank (IDB) on how to obtain sukuk to probably fund the 2017 budget. Specifically, Nigeria is speaking with the investment arm of the Saudi Arabia-based IDB, the Islamic Corporation for the Development of the Private Sector (ICD), about this.
This, the Africa’s biggest economy, desperately needs as a way to get different sources of funding to reflate its dwindling economy.
Sukuk is an Islamic bond structured to generate returns to investors without infringing Islamic law, which prohibits interests or riba.
Chief Executive Officer of ICD confirmed on Tuesday at the Africa Islamic Finance Forum 2016 in Cote d’Ivoire that his organisation was in talks with Nigeria on a possible sukuk deal.
He noted that as soon as Nigeria agrees terms, the deal would be sealed.
Nigeria has struggled revive its economy, which fell into recession largely due to drop in the price of crude oil, its major source of revenue.
Also, renewed attack on oil installations by militants in the Niger Delta region of the country, where the oil is extracted from, has contributed to it.
Nigeria also majority imports what it consumes and this has weakened the country’s currency, the Naira, against major international currencies, including the Dollar, Pounds and Euro.
