The Senate has officially approved President Bola Tinubu’s request for a $2.2 billion loan, aimed at addressing part of the ₦9.7 trillion budget deficit for the 2024 fiscal year.
This approval came after a report was presented by Aliyu Wamakko, the Chairman of the Senate Committee on Local and Foreign Debts, during a plenary session.
Deputy Senate President Jibrin Barau, who presided over the session, praised the committee for its swift and thorough examination of the loan proposal.
In a letter read at both the Senate and House of Representatives plenaries earlier this week, President Tinubu outlined that the loan would be integral to his administration’s fiscal strategy for 2024.
Senate President Godswill Akpabio, reading from the letter, confirmed that the $2.2 billion (approximately ₦1.77 trillion) is already included in Nigeria’s external borrowing plan for the upcoming fiscal year.
Akpabio also directed the Senate Committee on Local and Foreign Debts to expedite its review of the loan request and report its findings within 24 hours. Despite the deadline passing on Wednesday, the committee submitted its report on Thursday, leading to the loan’s approval.
Wamakko’s report, titled Implementation of New External Borrowing of ₦1.77 Trillion ($2.2 Billion) in the 2024 Appropriation Act, explained that the loan is crucial for funding ongoing projects as outlined in the 2024 Appropriation Act, which are essential for Nigeria’s growth and development.
According to Wamakko, the loan will also aid in the implementation of Nigeria’s Debt Management Strategy, which aims to reduce borrowing costs, extend debt maturity, create space for domestic market borrowers, and boost the nation’s external reserves.
He further explained that Nigeria could raise the required funds through various means, including issuing Eurobonds in the International Capital Market (ICM).
The committee recommended that the Senate approve the external borrowing of ₦1.77 trillion ($2.21 billion), which will be raised from one or more sources, such as the issuance of Eurobonds, sovereign Sukuk debt, or syndicated loans, depending on market conditions.
Wamakko added that, given the increase in the official exchange rate from USD1.00/₦800 to approximately ₦1,640, the extra funds generated from this adjustment should be exclusively directed toward capital projects in 2024. This would ensure that additional funds are channeled into infrastructure and developmental projects, contributing to long-term growth and stability for the country.
Following the presentation of the report, the Senate approved the loan without any objections, at the Committee of Supply.
In conclusion, the Deputy Senate President commended the Senate committee for their thorough work, expressing gratitude for the timely handling of the matter.
READ ALSO:
Kindly Share:
Discover more from LMSINT MEDIA
Subscribe to get the latest posts sent to your email.