Within 48 hours of President Bola Ahmed Tinubu writing to the National Assembly seeking approval to borrow N1.767 trillion (about $2.209 billion), the lawmakers have approved the request.
The loan was approved in the Senate, presided over by Deputy Senate President Barau Jibrin, after the Senate Committee on Local and Foreign Debts, chaired by Senator Wammako Magatarkada (APC, Sokoto North), presented its report.
The House also swiftly approved the request after considering the Committee on Aids, Loans and Debt Management report, chaired by Hon Abubakar Hassan Nalaraba (APC, Nasarawa), at the plenary on Thursday.
Consequently, the House approved the implementation of the new external borrowing of N1.767 trillion at the Budget exchange rate of USD1.00/800 in the 2024 Appropriation Act, with the amount to be raised from one or more sources.
These include the issuance of Eurobonds in the ICM, debut sovereign Sukuk in the ICM, and Bridge/syndicated loans, subject to market conditions.
According to the approved report, “based on availability and cost, to issue Eurobonds in the sum of USD1.70 billion or more, but not more than USD2,209,512,902,22b, approved as New External Borrowing in the 2024 Act.
The fresh loan is expected to increase the federal government’s debt servicing spending. The Central Bank of Nigeria said it cost the Federal Government $3.58 billion to service foreign debt in the first nine months of 2024.
The CBN report on international payment statistics showed that this amount represents a 39.77 per cent increase from the $2.56bn spent during the same period in 2023.
According to the report, while the highest monthly debt servicing payment in 2024 occurred in May, amounting to $854.37m, the highest monthly expenditure in 2023 was $641.70m, recorded in July.
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