FG Clarifies Plans To Borrow $21.5bn, Names Prospective Lenders

• The Ministry of Finance has provided clarification to the borrowing request of President Bola Tinubu
• The president, in a letter to lawmakers seeking approval, said that the new loan is for economic growth
• The new loan has raised eyebrows among Nigerians about the country's current public debt level

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The Ministry of Finance has clarified President Bola Tinubu’s $21.5 billion borrowing request to the National Assembly.

In a statement signed by Mohammed Manga, director of information and public relations, the ministry explained that the borrowing plan is part of a debt management framework and does not signify an automatic increase in the country’s debt burden.

Legit.ng earlier reported that Tinubu, on May 27, 2025, asked lawmakers to approve a new external borrowing plan totalling $21.5 billion, along with a request to issue federal government bonds worth N757.9 billion to settle outstanding pension liabilities under the Contributory Pension Scheme (CPS).

In the statement, the finance ministry said the borrowing request is designed to introduce a more structured, forward-looking approach to managing public debt and replacing past practices of reactive borrowing.

Manga said:

“The Debt Rolling Plan is not an automatic green light for increasing the debt burden. It is a strategic framework that guides sustainable and purposeful borrowing."

He added that the strategy aims to enhance Nigeria’s ability to implement sound fiscal policies and attract development financing while maintaining debt sustainability.

Prospective lenders of Nigeria's $21.5bn loan

The ministry noted that most of the proposed loans would be sourced from development partners, including the World Bank, African Development Bank, China EximBank, Japan International Cooperation Agency (JICA), the French Development Agency, European Investment Bank, and the Islamic Development Bank.

The statement added:

“These institutions provide concessional financing with favourable terms and long repayment periods, which align with the country’s development needs."

The government said the funds would support critical sectors such as infrastructure, transportation, energy, and agriculture, all considered vital for achieving rapid and inclusive economic growth.

It added:

“Our borrowing strategy is guided not by the volume of loans but by their utility, sustainability, and the economic value they generate. Each facility will be strictly tied to growth-enhancing projects."

The statement further reiterated the government’s commitment to fiscal discipline, improved revenue generation, and maintaining borrowing within sustainable limits, the Cable reports.

Manga said ongoing tax reforms and other revenue-boosting initiatives would help strengthen financial management and reduce dependence on debt.

The ministry said:

“Legislative oversight and public engagement are key to building long-term economic stability and inclusive national prosperity."

Nigeria’s debt to countries rises

Earlier, Legit.ng reported that Nigeria’s debt stock to countries under bilateral agreement hit $6.09 billion at the end of December 2024, according to data from the Debt Management Office (DMO).

The new debt stock is a 2.23% or $133.02 million increase when compared to $5.96 billion reported at the end of 2023.

There are six countries captured in the DMO data, which include China, France, Japan, India and Germany.

Proofreading by James Ojo, copy editor at Legit.ng.

Source: Legit.ng