Senate Approves Buhari’s $ 6.1 Billion Loan Request | The Guardian Nigeria News
The Nigerian Senate on Wednesday approved a $ 6.1 billion loan request from President Muhammadu Buhari.
The loan request of $ 6.1 billion, which is equivalent to about 2,343 billion naira, was approved after the Senate considered the report of the Senate Committee on Local and Foreign Debt.
The Senate resolution follows the approval of its committee on local and foreign loans presented by the president, Clifford Ordia.
The Committee recommended that the Senate approve Buhari’s request for the issuance of $ 3,000,000,000, but not more than $ 6,183,081,643.40, of Eurobonds in the international capital market.
The external loan of N 2,343,387,942,848, according to the panel, should be intended to finance part of the deficit authorized in the 2021 finance law.
The Committee also recommended that the Senate go ahead to approve the authorized amount, as it also stated that the amount could be raised from multiple sources such as the international capital market and any other multilateral or bilateral source available. .
He also recommended that the Senate order the Minister of Finance, Budget and National Planning, the Director General of the Debt Management Office and the Governor of the Central Bank of Nigeria to submit to the National Assembly within a deadline. 10 working days (excluding the day of the close of business) a letter containing the amount in United States dollars so collected and received as a result of the above approval as well as the applicable exchange rate.
Buhari said in May that the loan will be raised from multilateral and bilateral tenders as well as from the international capital market.
He also revealed that the National Assembly had already approved the borrowing of 4.6 trillion naira in the 2021 budget law. And that the new borrowing of 2.3 trillion naira will partially finance the 2021 budget deficit.
Senator Ordia said the request is not new as it was approved in the borrowing plan when the National Assembly adopted the 2021 budget.
“What we are about to spend is not a new borrowing, it was approved in the 2021 budget,” Ordia said.
After the approval, Senate Speaker Ahmad Lawan said the National Assembly must ensure there is no frivolous spending on the part of the executive.
“Let me thank the committee, this is not a new loan. This is a borrowing plan that we have approved. What we have done is provide the resolutions necessary for its implementation, ”Lawan said.
“Every penny counts. Our committees must be alive to watch it. No frivolous expense should be considered.
Nigeria’s 2021 budget already has a deficit of 5.6 trillion naira.
Buhari said the loan will be used to finance “projects in priority sectors of the economy, namely: electricity, transport, agriculture and rural development, education, health, supply of counterpart funding for multilateral and bilateral projects, defense and water resources ”.
Amid Nigeria’s growing debt profile, Buhari said the measure was necessary because of the “existential challenge of the coronavirus pandemic and its aftermath; I think that provides a rationale for exceeding the threshold as provided for in this law. “