By Abiola Olawale
The House of Representatives has approved President Bola Ahmed Tinubu’s request to borrow $2.347 billion from the international capital market.
Similarly, the green chamber on Wednesday granted Tinubu’s request to issue a $500 million debut sovereign sukuk in the international capital market (ICM) to fund infrastructure projects and diversify Nigeria’s financing sources.
The lower legislative chamber approved the president’s request after considering the report of the committee on aids, loans, and debt management.
The green chamber approved the implementation of the new external borrowing of N1,843,669,786,987.16 (equivalent to $1,229,113,000.00) at the budget exchange rate of $1.00/N1,500 as provided as new external borrowing in the 2025 Appropriation Act, to part-finance the budget deficit of N9,276,348,934,935.79.
Recall that Tinubu, in a letter addressed to the Speaker of the House of Representatives, Tajudeen Abbas, sought the approval of the loan.
The President had said that the external borrowing is backed by provisions of sections 21(1) and 27(1) of the Debt Management Office (Establishment) Act, 2003.
Tinubu also added that the funds would be raised through one or a combination of instruments such as eurobonds, loan syndications, or bridge financing facilities, depending on prevailing market conditions.
He said the federal government expects the pricing of the new eurobonds to align with current yields on Nigeria’s existing bonds in the international market, ranging between 6.8 percent and 9.3 percent, depending on maturity.
On the proposed $500 million sovereign sukuk, Tinubu said the move would help diversify Nigeria’s investor base and deepen the government securities market, adding that the proceeds will support the development of critical infrastructure projects across the country.
