BREAKING: Senate Approves Buhari’s $8.3bn, €490m External Loan Request, Gives Reason

BREAKING: Senate Approves Buhari’s $8.3bn, €490m External Loan Request, Gives Reason

  • President Buhari has again secured the approval of the Senate to borrow $8.3 billion and €490 million from international financial institutions
  • The Red Chamber approved the loans on Thursday, July 15, following a report of the committee on local and foreign debts
  • Clifford Ordia, the chairman of the Senate, explained that loans will be used to fund projects cutting across several sectors in all the six geopolitical zones

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National Assembly complex, Abuja - The Senate has approved the $8.3 billion (N8,325,536,537) loan request tabled before it by President Muhammadu Buhari, Premium Times reported.

The Nation stated that the lawmakers also approved a separate €490 million loan request by the Nigerian leader.

Foreign Debt: Senate Approves President Buhari’s $8.3bn, €490m External Loan Request
The Senate has approved the $8.3 billion loan request tabled before it by President Buhari. Photo credit: Femi Adesina
Source: Facebook gathers that the total amount is part of the federal government's 2018-2020 external borrowing (rolling) plan.

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The fund was approved on Thursday, July 15, after the Senate considered the report of the committee on local and foreign debts.

The chairman of the committee, Clifford Ordia, presented the report.

World Bank, AfDB, others to provide the loan

Recall that President Buhari had in May asked the National Assembly to approve the loan. He had explained that the loans if approved, would be used to finance the projects listed under the 2018-2020 External Borrowing Plan.

The loans will be sourced from the World Bank, African Development Bank (AfDB), French Development Agency (FDA), Islamic Development Bank, China EXIMBank, and other international financial institutions.

In his presentation, Senator Ordia noted that the projects to be financed by the loans are geared towards the realisation of the Nigerian Economic Sustainability Plan that cut across key sectors such as infrastructure, health, among others, in the six geo-political zones of the country.

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List of funding agencies/loans

  1. World Bank – $796 million
  2. China EXIMBank – $2.9 billion
  3. Industrial Commercial Bank of China – $2.4 billion
  4. African Development Bank (AfDB) – $104 million
  5. Africa Growing Together Bank – $20 million
  6. French Development Agency (AFD) – €240 million
  7. European Investment Bank – €250 million
  8. European ECA, KfW, OPEX, AFC – $1.95 billion
  9. International Fund for Agricultural Development (IFAD) – $60 million

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FG used almost all its N1.84 trillion revenue to pay off debt

Meanwhile, for every N100 the administration of President Buhari made in the first five months of 2021, N97 was used to pay off debtors owed by the federal government.

Between January to May 2021, the Nigerian government recorded a turnover of N1.84 trillion but it used N1.8 trillion to service its debt.

This means for the most part of the first half of 2021, the FG's debt-to-revenue ratio was 97.8% and it has used 72.2% of its projected debt service for the year.


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