Senate approves Buhari’s request for $8.325m, £490m external loans

The Senate on Thursday considered the report of its Committee on Local and Foreign Debt.

Chairman of the Committee and Senator representing Edo Central, Clifford Ordia had presented the report on the federal government 2018-2020 External Borrowing (Rolling) Plan.

The Senate consequently approved President Muhammadu Buhari’s request for ongoing external loans to the tune of $8,325,526,537 (USD) and £490,000,000 (Euros) under the 2018-2020 External Borrowing (Rolling) Plan.

Ordia noted that out of the total borrowing request of $36,837,281,256 contained in the re-forwarded request of Mr President, a sum of $26,154,536,533 is for funds proposed to be borrowed from various financial institutions from the Peoples Republic of China.

He further noted that the proposed projects in the Ministries’ of Transportation, FCT, Aviation, Works & Housing, Agriculture and Water Resources and some Commissions such as National Universities Commission, North East Development Commission and the National Identity Management Commission are mostly ongoing projects and programmes in respect of which External Borrowed funds have been spent in the past, including loans.

“These projects have a great multiplier effect on stimulating economic growth through infrastructure Development, Job creation and Poverty alleviation, stimulation of Commercial and Engineering activities and the consequent tax revenues payable to Government as a result of these productive activities”

He listed the funding agencies to include, World Bank – $796,000,000; China Exim Bank – $2,901,026,509; Industrial Commercial Bank of China – $2,484,555,304; African Development Bank – $104,200,000; Africa Growing Together Fund – $20,000,000; French Development Agency – £240,000,000; European Investment Bank – £250,000,000; European ECA/KfW/IPEX/AFC – $1,959,744,724; and International Fund For Agricultural Development (IFAD) – $60,000,000.

While presenting the report, Senator Ordia bemoaned the concerns of Nigerians about the nation debt profile, its sustainability and serviceability.

He said, “Our (Nigeria’s) debt service figures constitute a huge drain on our revenue to the extent that it accounts for over 30 per cent of our expenditure in the annual budget.”

He explained that due to the shortfall in the country’s annual revenues in relation to the need for rapid infrastructural and human capital development, “we have had to pass deficit budget every year, requiring us to borrow to finance the deficit in our budget.”

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