Nigeria Plans to Borrow $5 Billion from UAE Bank Amid Rising Costs | Firstpost Africa

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Издатель Apr 2, 2026

As geopolitical tensions in Iran send interest rates soaring, Nigeria is pivoting away from traditional borrowing to stay afloat. To fund its massive $49.4 billion budget for 2026, the government is eyeing a $5 billion "total return swap" with the First Abu Dhabi Bank. By planning to pledge Nigerian securities worth 133% of the loan as collateral, President Tinubu’s administration hopes to secure cash at lower rates than the ones volatile global markets are currently offering. However, the strategy is a double-edged sword. These complex derivatives are the same financial instruments that triggered the collapse of Archegos Capital in 2021. While the deal aims to finance critical infrastructure and refinance expensive debt, it hitches Nigeria’s economic future to market stability. With the government also betting on higher oil prices to plug budget deficits, this high-stakes manoeuvre represents an attempt to outrun a global economic storm, fuelled by Iran's war.

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