President Bola Tinubu has tabled another loan request before the National Assembly seeking an approval for a fresh N1.77 trillion external borrowing plan.
By Emma Ogbuehi
President Bola Tinubu has tabled another loan request before the National Assembly seeking an approval for a fresh N1.77 trillion external borrowing plan.
The request was conveyed by Tinubu in a letter to Senate President Godswill Akpabio and Speaker of the House of Representatives, Tajudeen Abbas.
Recall that TheNiche had in October, reported that the president had borrowed $6.45 billion from the World Bank in just 16 months of his administration
In the current move, Tinubu stated that if approved, the loan would partly finance the N9.7trn deficit in the 2024 budget.
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The loan request, he added, has been approved by the Federal Executive Council (FEC) and is in line with Sections 21(1) and 27(1) of the Debt Management Office Act.
Tinubu’s letter listed three potential financing options to raise the required funds which include the issuance of Eurobonds, Sovereign Sukuk and Bridge Finance/Syndicated Loans.
Speaking on the Eurobonds, the president said part of the funds could be raised by Nigeria via Eurobond sales in the International Capital Market (ICM).
President Tinubu, while shedding light on Sovereign Sukuk, disclosed that the debut issuance of Sovereign Sukuk worth $500 million is being considered, with credit enhancement from the Islamic Corporation for the Insurance of Investment and Export Credit (ICIEC), a member of the Islamic Development Bank Group.
Additionally, he pointed out that the Bridge Finance/Syndicated Loans option involves loans from international financial institutions such as Citigroup, Goldman Sachs, and JPMorgan, should Eurobond issuance face delays due to market conditions.
Addressing the issue of utilisation of the funds, Tinubu said key projects in priority sectors, including power, transport, agriculture, and defence would be supported by the federal government.
Furthermore, he noted that external reserves through deposit into the Central Bank of Nigeria’s account would be bolstered by the proceeds, thereby stabilising the Naira.