Senate approves Buhari’s request to borrow N2.343trn

The Senate yesterday approved President Muhammadu Buhari’s request to borrow N2.3trn ($6.183bn) to fund the deficit in the 2021 Appropriation Act.

The loan is to be sourced through the Issuance of Eurobond in the International Capital Market

The approval followed the consideration of the report of the Committee on Local and Foreign Debts, chaired by Senator Clifford Ordia (PDP, Edo).

Ordia said the new borrowing was calculated at Exchange rate of USD1/N379, and raised from multiple sources - multilateral and bilateral lenders through the issuance of Eurobonds in the International Capital Market.

He said the proceeds of $6.183bn would be used to fund various specific capital projects specifically from priority sectors of the economy namely; power, transportation, agriculture and rural development, education, health, provision of counterpart funding for multilateral and bilateral projects, defence and water resources.

The Senate, while adopting the resolutions of the Committee on Local and Foreign Debt approved the issuance of $3bn, but not more than $6,183,081,643.40 Eurobond in the International Capital Market for the implementation of the new External Borrowing of N2,343,387,942,848, for the financing of part of the deficit authorized in the 2021 Appropriation Act.

It directed 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 ten working days (excluding the day of close of trading) a letter containing the United States Dollars amount so raised and received as a result of the approval together with the applicable exchange rate.

Senate President Ahmad Lawan tasked committees of the National Assembly to carry out strict oversight on how the loans are applied to the implementation of the 2021 budget.

Lawan urged Ministries, Departments and Agencies of Government entrusted with the management of the funds to ensure prudent application to projects across the country.

“Our committees should be alert on how the funds that will be borrowed will be used.

“No frivolous expenditures should be entertained. I imagine that everybody in the trust of public funds, especially this laws will be as prudent and economical as possible”, he said.