Nov. 25 (Bloomberg) -- Nigeria will revive next year the $500 million Eurobond sale it suspended this year because of the global economic crisis, Finance Minister Mansur Muhtar said.

The bond sale is “part of the way we’ll finance the budget deficit,” which will reach 1.56 trillion naira ($10.4 billion), or 4.8 percent of gross domestic product, in 2010, Muhtar said in an interview in the capital, Abuja, today. He didn’t provide details on the bond’s coupon, which banks are arranging it, and when it will be sold.

The bond “would be welcomed, no doubt, though a larger size would have been better,” Richard Segal, an analyst at U.K.-based Knight Libertas Ltd., said in an e-mail.

Emerging-market stocks, bonds and currencies have rallied as evidence of a global economic recovery boost demand for the raw materials that sustain many developing economies and as appetite increased for higher-yielding assets. South Africa’s rand has gained 45 percent against the dollar since March 5, while Nigeria’s naira has stabilized since then. Developing- nation government bonds are trading near the lowest yields on record, according to JPMorgan Chase & Co.

The bond sale comes as the West African nation yesterday announced a 4.1 trillion-naira budget for next year, about a quarter bigger than the 2009 budget.

Nigeria, which rivals Angola as Africa’s biggest oil producer, suspended the planned sale of bonds in March, seven months after it was first announced.

Oil Boost

Rising oil prices will help lift economic growth to 6.1 percent next year from 5.86 percent this year, yesterday’s budget statement said. The economy expanded 7.2 percent in the second quarter, compared with 4.5 percent in the previous three months, and will grow about 7.6 percent in the third quarter, Central Bank of Nigeria Governor Lamido Sanusi said on Nov. 3.

Oil fell from an all-time high of $147.27 a barrel in July last year to $32.40 in December and is trading at $76.86 today.

Nigeria’s foreign currency-denominated long-term debt is rated “B+" by Standard & Poor’s, or four notches below investment grade, and “BB-”, or three steps below investment grade, by Fitch Ratings. The yield on its 91-day Treasury bill is 4.655 percent, according to the central bank’s Web site.

Africa’s most populous nation has $17.1 billion in outstanding debt, according to Bloomberg data.

Sub-Saharan Africa plans for international bond issues are now almost $6.45 billion, excluding Nigeria’s sale, Samir Gadio, an analyst at Renaissance Capital, wrote in a research note yesterday.

To contact the reporter on this story: Paul Okolo in Abuja pokolo@bloomberg.net

Last Updated: November 25, 2009 11:24 EST