Senate Approves Buhari’s $16bn, €1bn Loan Requests

President Muhammad Buhari’s request to borrow $16. 23bn and €1bn from the World Bank, African Development Bank and the French Development Agency (AFD) has been approved by the Senate.

Naija News reports that the red chamber gave the approval on Wednesday after considering a report presented by the Chairman of the Senate Committee on Local and Foreign Debts, Senator Clifford Ordia.

The Senate also approved grant components of $125 million which was part of the 2018-2020 borrowing plan sent to the upper legislative chamber in September.

It specifically approved the issuance of €500,000,000 from the Bank of Industries and €750,000,000 Eurobond in the International Capital Market and asked the President to forward the terms and conditions of the loan from the funding agencies to the National Assembly.

Presenting the report during plenary, Ordia pointed the loans request is not a new one, and it would stimulate the economy which suffered recession due to the impact of COVID-19.

The lawmaker added that the projects for which the loan was requested will stimulate economic growth through infrastructure development, job creation, poverty alleviation, health care and improve our security architecture.

He said: “It will be recalled that the senate at plenary in July 2021 approved financing for projects as recommended by the Committee above whilst the Committee continued further legislative action and consideration of the outstanding request.

“Subsequently, on the 15th of September 2021, the President of the Senate of the Federal Republic of Nigeria read another Communication from the President and Commander in Chief of the Armed Forces, Containing an addendum to the 2018-2020 External Borrowing (Rolling) Plan in the sum of $4,054,476,863, €710,000,000 and Grant Component of $125,000,000 for various projects and same was also referred to the committee for further legislative action.

“The committee notes that a good number of the projects in respect of which financing is being requested under the 2018-2020 external borrowing (rolling) plan are mostly ongoing projects and programmes in respect of which external borrowed funds have been spent in the past, including loans and grants.

“The committee found as a fact that out of a sum of over $22.8billion approved by the National Assembly under the 2016-2018 external borrowing rolling plan, only $2.8billion, that is 10% has been disbursed to Nigeria.

“The committee observes that these projects, some of which require additional financing, will have a great multiplier effect on stimulating economic growth through infrastructure development, job creation, poverty alleviation, health care and improve our security architecture.”