Senate Approves Buhari’s N7.6trn External Borrowing Request

The Senate yesterday approved President Muhammadu Buhari’s request to borrow about N7.6 trillion comprising $16.2 billion and €1 billion (Euros) under the 2018-2020 External Borrowing (Rolling) plan, and a $125 million grant component.

It also approved the request to the Bank of Industries (BoI) for the issuance of €500 million (Euros) but no more than €750m Eurobond in the International Capital Market.

The approval of the request followed the consideration of the report by the Senate Committee on Local and Foreign Debt.

President Buhari had, in a letter read in the Senate on September 15, 2021, requested for the approval of $4,054,476,863, €710,000,000 and $125,000,000 borrowing requests.

The loans, Buhari said, were to finance critical infrastructure projects across the country.

Presenting the report, the Chairman of the committee, Senator Clifford Ordia (PDP, Edo), said his panel found that of the $22.8bn approved by the National Assembly under the 2016-2018 External Borrowing Plan, only $2.8bn, representing 10 percent, has been disbursed to Nigeria.

The lawmaker said out of this, $3.529bn would be sourced from the World Bank; $5.078bn from China EximBank; $3.902bn from Industrial & Commercial Bank of China; $2.893bn from China Development Bank; and $698.5m from the Africa Development Bank (AfDB).

He also said €345m (euro) was to be sourced from the French Development Agency (AFD); €175m from the European Investment Bank; $190.255m from European ECA/KfW/IPEX/AFC; €500m from the International Capital Market; and $62.120m from Standard Chartered Bank/SINOCURE.

Meanwhile, senators have expressed concern that the borrowing request was approved without details of the terms and conditions of the loans from the funding agencies.

Sen. Solomon Adeola (Lagos West) said it would be awkward to seek terms and conditions, after the loan has been approved.

Deputy Senate President, Ovie Omo- Agege (Delta Central) said going by the committee’s recommendation, the Senate has not given approval to terms and conditions.