In a significant development, President Bola Ahmed Tinubu has formally requested approval from Nigeria’s National Assembly to secure substantial external loans, totaling $21.5 million, ¥15 billion, and a grant of €65 million, to fund various developmental initiatives under the 2025-2026 borrowing plan.
The request was announced during a plenary session, where Senate President Godswill Akpabio read the president’s letter. Although the full breakdown of the funding was not disclosed, the letter outlined the broad objectives for the proposed loans.
According to President Tinubu’s letter, the external funds are intended for strategic projects aimed at tackling key national issues such as infrastructure development, poverty reduction, and employment generation. Specifically, the funds will be allocated to projects in agriculture, health, education, water supply, and security.
“The total facility of the projects and programs under the borrowing plan is estimated at $21.5 million and ¥15 billion, with grants of €65 million,” President Tinubu stated, emphasizing that these funds will help address critical infrastructure deficits and promote skill acquisition, entrepreneurship, and food security across the nation.
The proposed borrowing plan, which spans multiple sectors, is designed to boost economic growth and job creation nationwide, with an emphasis on all 36 states and the Federal Capital Territory.
However, the request comes amid growing concerns over Nigeria’s rising public debt. As of December 2024, Nigeria’s total public debt stood at N144.7 trillion (approximately $94.2 billion), with domestic debt comprising 51.4% and external debt at 48.6%.
The debt servicing burden has also increased significantly, with Nigeria spending N7.8 trillion in 2023 and N13.12 trillion in 2024, marking a drastic rise in debt servicing costs. These growing expenses have raised concerns about the country’s fiscal sustainability and its ability to fund other critical sectors.
Despite these concerns, President Tinubu defended the decision to borrow, citing the necessity of external funds for financing infrastructural development, especially as domestic revenues continue to fall short. He stressed that borrowing is a vital tool to close the nation’s financial gap and provide essential services.
“In light of the significant infrastructure deficit and the resources needed to address it, external borrowing remains crucial,” President Tinubu explained. He assured that the borrowed funds would be deployed efficiently to meet the nation’s developmental needs, including the revitalization of Nigeria’s outdated infrastructure.
The proposal was immediately referred to the Senate Committee on Local and Foreign Debt, with a mandate to review the plan and report back to the Senate within two weeks for further deliberation.