THE Senate has approved the 2025-2026 external borrowing plan of $21.5 billion presented by President Bola Tinubu for consideration.
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Also approved was a loan request of 15 billion Japanese Yen and 65 million Euros grant.
The Senate also approved the issuance of Federal Government Bond of N757 billion for payment of accrued rights pension arrears as at December 2023 for the Contributory Pension Scheme (CPS).
The Upper Chamber also approved President Tinubu’s request for capital raising of up to $2 billion through a foreign-currency-denominated instrument in the domestic market.
The approval yesterday was sequel to the presentation and consideration of the report of the Committee on Local and Foreign Debt by Chairman of the Committee, Sen. Aliyu Wamakko, APC, Sokoto North.
Recall that the loan request, according to President Bola Tinubu, was designed to fund various critical national development projects across key sectors of the economy.
In his presentation, Senator Wamakko who noted that the loan request was part of the already approved Medium Term Expenditure FrameWork (MTEF)and Fiscal Strategy Paper (FSP) for the 2025 budget, said that the MTEF and FSP contained most of the items in the borrowing plans, adding that based on the findings, the committee recommended that the Senate do approve the President’s request.
On his part, Chairman, Senate Committee on Appropriations, Senator Solomon Adeola, APC-Ogun West, who seconded the motion for approval, said that the approval was largely a formality, as most of the items had already been outlined in the MTEF and 2025 budget previously passed by the National Assembly.
Adeola said, “The borrowing is already embedded in the 2025 Appropriation Act. With this approval, we now have all revenue sources, including loans, in place to fully fund the budget,” Adeola said.
In his contribution, Chairman, Senate Committee on Finance, Sen. Sani Musa, APC, Niger East, who noted that the borrowing plan covers a six-year disbursement period, not just the 2025 fiscal year, said that Nigeria has not defaulted on any of its existing loan repayments.
Musa said, “There’s no economy that grows without borrowing. What we are doing is in line with global best practices.”
On his part, Senator Sen. Adetokunbo Abiru, APC Lagos East, who assured that the Senate that the loan request compiled with the Fiscal Responsibility Act (FRA)and the Debt Management Act, saying the funds are for capital projects and human development, said, “These loans are long-term, concessional, and come with favorable repayment terms. Some stretch between 20 and 35 years.”
However, Senator Abdul Ningi, PDP-Bauchi Central, who raised concerns that the committee in its document did not indicate how the loan would be repaid, said that there was a need to detail how the loan sought after would be used to impact constituents, saying that the people would ask the lawmakers how the funds were expended.
Ningi, who noted that the document failed to provide specific breakdown on what each state or agency would receive and how the loans would be repaid, said, “We need to tell our constituents exactly how much is being borrowed in their name, and for what purpose.”
He cited constitutional provisions regarding borrowing oversight.
In his contribution, Senator Victor Umeh, LP-Anambra Central, who expressed strong support for the plan, highlighting the provision on investment in the eastern corridor, said, “This is the first time I’ve seen three billion dollars allocated to rebuild the eastern rail line, that alone justifies my full support.”
In his remarks, Deputy Senate President Jibrin Barau, APC, Kano North, who presided, lauded the committee’s input, saying that the entire nation was being carried along in the borrowing plan.
He said, “This shows that the Renewed Hope Agenda is working; no region is left out. With the borrowing plan now approved, implementation of the 2025 Appropriation Act can begin in full.”
He said that all funds disbursed under the facility must be utilised strictly for capital and developmental projects, in line with the laws governing public finance.
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