The Debt Management Office (DMO) has said that the proposed Diaspora bond to be issued by the Federal Government will be tied to specific projects to enhance the economy.

Dr Abraham Nwankwo, DMO Director-General made this known in an interview with our correspondent on Sunday in Abuja.

“ On the issue of Diaspora bond, as you know, the Coordinating Minister for the Economy, Dr Ngozi Okonjo-Iweala, has some months ago, made a public statement that Nigeria is going to prospect, issuing a Diaspora bond.

“And she has given the DMO a mandate to work with this and she has set up a technical committee to make progress on this part and progress is being made in finalising the framework and the objective of issuing a Diaspora is still on focus.

“The only point I can make at this date is that whatever Diaspora bonds will be issued, will be tied to specific projects.’’

Nwankwo said the issuance of the Euro bond was to give Nigeria visibility in the international finance market.

He added that the specific projects to which proceeds of the bond would be deployed would be made public.

“Those who are investing in the bond will know that the proceeds are billed to develop specific projects that have been designed and that will be projects that are part of national priority either in terms of real sector or in terms of infrastructure.’’

Nwankwo noted that by the time the framework was ready, the coordinating minister would tell the public the next step forward.

He said that most global investors had positive outlook of the Nigerian economy and also expressed strong confidence in the way the economy was being managed.

This, he stressed, had contributed to the over-subscription of the bond in the market.

“The international community, the discerning investors, the global fund managers are keen on being part of the process of transformation in the economy.

“And that’s why they are keen to buy the Nigerian bond in the international capital market; that’s why they are making strong demands for additional bond issues in the international capital market.’’

He noted that the bond had been trading in the market at 5.7 per cent and 5.8 per cent premium per annum, lower than 6.75 per cent coupon at which it was issued.

He said that the price had been lower and had generated a great demand for the bond.

Nwankwo also noted that even with the challenge of insecurity in the country, the euro bond had traded positively at the international market.

“Even with the security challenges the international community appreciates the strategy government is employing to respond.

“What is important to them is what is being done to address the problem; they appreciate that government is doing something and using a package of measures to deal with this effectively.’’

We  recalled that the 500 million dollars Euro bond was issued in January 2011 and was oversubscribed by more than 200 per cent.

The investor distribution was widespread. Euro, Asia, North and South America participated effectively and global fund managers were also represented in the distribution.