Tinubu's Move to Borrow N7.6 Trillion Will Take National Debt Close to N100 Trillion

• President Bola Tinubu's move to borrow another $8.6 billion external loan would take Nigeria's debt close to N100 trillion
• The President asked the National Assembly to approve $8.6 billion and 100 million euro loan
• The country's current debt profile stands at N87.579 trillion as of June 30, 2023

Pascal Oparada has over a decade of experience covering Tech, Energy, Stocks, Investments, and Economy.

Nigeria's external debt profile will hit close to N100 trillion as President Bola Tinubu, on Tuesday, November 28, 2023, asked for the approval of the National Assembly for a fresh $8.6 billion and 100 million euro foreign loan.

Tinubu's request is part of an external borrowing plan for 2022-2024 for essential infrastructure, such as power, roads, water, railways, and health.

Nigeria currently owes N87.379 trillion

Data from the Debt Management Office reveals that Nigeria's external debt has crossed the N87 trillion mark, as domestic debt stands at N54.130 trillion.

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Tinubu seeks Reps approval for $8.699bn, €100m external loans

Vanguard reports that a breakdown of Nigeria's multilateral borrowing consumed $20.790 billion, bilateral at $5.518, commercial at $15.618 billion, Promissory notes at $931 million and $300 million, respectively.

As of June 2023, domestic and external, the country's total public debt is N87.370 trillion.

Tinubu also sent the FCT supplementary budget to the National Assembly for consideration and will officially present the 2024 Appropriation Bill on Wednesday, November 29, 2023.

Tinubu seeks NASS approval for fresh loans

The letter from the Presidency to the Senate President, Godswill Akpabio, and Speaker of the House of Assembly, Tajudeen Abbas, was read in plenary on Tuesday, October 28, 2023.

The letter partly reads:

"The Senate may wish to note that the past administration approved a 2022-2024 borrowing plan by the Federal Executive Council, FEC, held on May 15, 2023.

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"The project cuts across all sectors, with specific emphasis on infrastructure, agriculture, health, water supply, roads, security, and employment generation as well as financial management reforms.

"Consequently, the required approval is for $8,699,168,559 and €100 million.

"I would like to underscore the fact that the projects and programmes in the borrowing plan were selected based on economic evaluations as well as the expected contribution to the social and economic development of the country, including employment generation and skills acquisition.

"Given the nature of these facilities and the need to return the country to normalcy, it has become necessary for the Senate to consider and approve the 2022- 2024 external abridged borrowing plan to enable the government to deliver its responsibility to Nigerians."

FEC Okays $1 billion AfDB loan

Recall that the Minister of Finance and Coordinating Minister of the Economy, Wale Edun, announced on Monday, November 27, 2023, that the Federal Executive Council has approved a $1 billion loan from the Africa Development Bank (AfDB).

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Edun stated that an inherited financing and processing loan involved $100 million from AfDB and $15 million from the Canada-African Development Bank Climate Fund.

Per the Minister, the FEC approved N2 trillion for the Ministry of Finance to go in and out of the market to reduce interest rates on the current outstanding.

He said there would be an opportunity to save about N50 billion in debt servicing over time by giving back costly debt refinancing with cheaper funding.

Edun said some economic measures by the committee, in the short term, are being contemplated, and their report was well received by the president and approved by the council.

Nigeria successfully repays China, the World Bank, others a $1.17bn loan, still owing more

Legit.ng reported that The federal government paid $1.17 billion to service foreign debt commitments in the first half of 2023.

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Naira’s loss at the official and parallel markets upsets Tinubu, CBN’s $1 trillion GDP plan

This was revealed in the Export and International Payment data released by the Central Bank of Nigeria (CBN).

Legit.ng earlier reported that the Nigerian government spent over 85% of its revenue servicing debt in February 2023.

Source: Legit.ng