ABUJA, Nigeria — The Nigerian Senate has approved a $2.09 billion (N1.767 trillion) loan request by President Bola Tinubu to address the N9.7 trillion deficit in Nigeria’s N28.7 trillion 2024 budget.
The decision, reached during the plenary session on Thursday, November 21, 2024, came just two days after the proposal was submitted to the National Assembly.
In letters to both chambers earlier this week, President Tinubu emphasised the significance of the loan for financing critical projects and programmes central to national development.
Following the President’s request, the Senate tasked its Committee on Local and Foreign Debts, chaired by Senator Aliyu Wammako (APC, Sokoto North), to review the proposal.
Presenting the committee’s findings, Senator Wammako described the loan as a strategic component of Nigeria’s Debt Management Strategy.
“The loan is critical for reducing borrowing costs, extending debt maturity, and boosting the country’s external reserves,” Wammako stated.
He also noted that the funds would ensure the smooth implementation of key developmental priorities outlined in the 2024 budget.
The committee recommended sourcing the loan through Eurobonds or other international financing mechanisms, contingent on favourable market conditions.
It further suggested that any surplus arising from exchange rate adjustments be channelled toward capital projects to bolster infrastructure development and economic growth in 2024.
Unanimous Senate Approval
During deliberations, the loan proposal faced no objections, and the Senate approved it unanimously.
Deputy Senate President Jibrin Barau, who presided over the session, lauded the committee for its expeditious and comprehensive handling of the request.
“This is a necessary step to bridge our fiscal gap while ensuring that we maintain focus on developmental priorities and economic stability,” Barau said, commending the Senate for its unanimous agreement.
A Broader Economic Strategy
The approved loan is part of the government’s strategy to address fiscal imbalances while focusing on infrastructure, economic growth, and stability.
With external borrowing continuing to play a pivotal role in Nigeria’s budgetary framework, the administration aims to balance short-term fiscal needs with long-term economic objectives.
Analysts are watching closely to see how the government will manage its increasing debt portfolio and ensure sustainable economic growth.
