President Bola Tinubu has written to the National Assembly seeking approval for a new external borrowing plan of N1.767 trillion to partly finance the N9.7 trillion deficit in the 2024 budget.
The President’s request, conveyed in letters to Senate President Godswill Akpabio and Speaker of the House of Representatives Tajudeen Abbas, was read during plenary sessions on Tuesday.
The loan proposal, already approved by the Federal Executive Council, aligns with Sections 21(1) and 27(1) of the Debt Management Office Act.
Tinubu outlined three financing options: Eurobond issuance, Sovereign Sukuk, and Bridge Finance/Syndicated Loans.
He noted that Eurobond issuance in the International Capital Market would be prioritised due to its speed and cost-effectiveness. Sovereign Sukuk, valued at $500 million, is being considered with credit enhancement from the Islamic Corporation for the Insurance of Investment and Export Credit. Alternatively, Bridge Finance options involve international financial institutions such as Citigroup, Goldman Sachs, and JPMorgan.
The funds, according to Tinubu, will support critical sectors like power, transport, agriculture, and defence, while also boosting external reserves to stabilise the naira.
Additionally, the President submitted the Medium-Term Expenditure Framework and Fiscal Strategy Paper 2025–2027 and the National Social Investment Programme Establishment Amendment Bill to prioritise the social register for welfare programme implementation.
This request comes amid rising foreign debt servicing costs, with the Central Bank of Nigeria reporting $3.58 billion spent between January and September 2024, representing a 39.77 per cent increase from the previous year.
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