Nigeria is preparing to issue its first $500 million global sukuk as part of a wider plan to raise $2.8 billion in 2025. The goal is to expand funding sources, attract ethical investors, and strengthen support for key infrastructure projects.
The announcement came from the Debt Management Office (DMO), which confirmed that the process is already underway. This will be Nigeria’s first sukuk in the global market. It marks a major step in diversifying the country’s borrowing options beyond traditional Eurobonds.
Finance Minister Wale Edun said the sukuk will help Nigeria attract investors from the Middle East, Asia, and Europe. These regions have strong Islamic finance sectors and an increasing interest in Africa. He described the move as part of a long-term plan to fund development in a more transparent and sustainable way. “This sukuk will open new doors for Nigeria,” Edun said. “It reflects our commitment to responsible borrowing and ethical finance.”
The DMO explained that funds from the sukuk will support road, rail, and energy projects, while part of the proceeds will refinance existing loans. Using the sukuk model also ensures that all borrowed funds are backed by real assets, as required under Islamic finance principles.
DMO Director-General Patience Oniha added that talks are ongoing with global underwriters and Islamic finance institutions. She said the agency expects strong investor interest. “Nigeria’s domestic sukuk market has performed very well,” Oniha said. “Taking it global is a natural next step.”
Financial analysts have welcomed the plan. Oluwaseun Adesina, a senior economist at Capital Analytics, said sukuk bonds could help Nigeria attract long-term capital. “Sukuk investors usually hold their positions for years,” he said. “That kind of stability is what Nigeria needs to fund its infrastructure goals.”
Since 2017, Nigeria has issued several local sukuk instruments, raising over ₦600 billion for road projects nationwide. These bonds have been oversubscribed each time. The government believes that a successful global sukuk will build on that track record and showcase Nigeria’s credibility to international investors.
Nigeria’s public debt currently stands at around ₦121 trillion ($80 billion), according to mid-2025 data from the DMO. While the debt-to-GDP ratio remains below 45 percent, high interest payments still strain government finances. Officials hope that sukuk borrowing—known for its lower risk and longer maturity periods—will help manage these costs more effectively.
Beyond the sukuk, the government plans to issue other conventional bonds and seek concessional loans from development partners such as the World Bank and the African Development Bank. The combined funding will be used to finance major infrastructure and support economic recovery programs.
Analysts believe Nigeria’s global sukuk debut will also position it as a leader in Africa’s Islamic finance space. Countries like Egypt, Senegal, and South Africa have already issued international sukuk with strong results. A successful offering from Nigeria could attract billions in future investments from ethical and Sharia-compliant funds.
The global demand for sukuk remains strong, driven by investors seeking safer, asset-backed options. Nigeria’s large economy and reform plans make it a promising destination. If this first issuance performs well, officials expect it to become a regular feature in the country’s annual financing strategy.
Minister Edun emphasized that the sukuk represents more than a borrowing tool. “This is about building investor confidence and supporting real projects that Nigerians can see,” he said. “Every dollar borrowed will go into infrastructure that drives growth and creates jobs.”
Preparations for the issuance are expected to conclude later this year, with investor consultations ongoing. Market experts say the outcome could set a benchmark for African sukuk offerings in the future. For Nigeria, it’s both a test and an opportunity—to show that ethical finance can support real development while keeping debt sustainable.
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