As the Nigerian Senate okayed Bola Tinubu’s request to borrow $ 7.8 billion and €100 million, the President has pumped up loans package of his administration.
The latest forms part of the 2022–2024 borrowing plan of the Federal Government.
The request was approved after the Senate considered and adopted the report of its committee on Local and Foreign Debt during Saturday’s plenary.
Tinubu had said that the Federal Executive Council under former President Muhammadu Buhari approved the loan facility on May 15, 2023, to finance health, education, infrastructure, agriculture, insecurity, and other sectors.
The president added that the foreign loan has become necessary to bridge the financial gap and return the economic activities of the country to normalcy, adding that it would be used to develop infrastructure, agriculture, health, education, water supply, security, and employment as well as financial management reforms.
Similarly, the Red Chamber also okayed Tinubu’s request to securitise the Central Bank of Nigeria N7.3trillion Ways and Means advances to the Federal Government.
Tinubu had, in a letter read by the Senate President Saturday, said the securitisation aims to reduce debt service costs and extend the repayment period of the existing loans.
The Ways and Means provision allows the government to borrow from the Central Bank if it requires short-term or emergency financing to support delayed government projected cash receipts of fiscal shortfalls.
The interest rate for the securitised Ways and Means advances has been reduced to 9% per annum, compared to the MPR of 0.3%.
Recall that the National Assembly had, a few months ago, approved the total of N819.5 billion presented by the president which, among other things, was for the provision of a N500 billion palliative package to cushion the effects of the recent economic policies of the Federal Government.
