Senate approves fresh $16.23b, €1.02b loan and $125m grant for FG

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The upper chamber has approved $16,230,077,718, €1,020,000,000 loans and a grant component of $125,000,000.00 requested by President Muhammadu Buhari under the “2018-2020 External Borrowing (Rolling) plan.”

Senate granted the loan and grants request following the presentation made by the Chairman of the Senate Committee on Local and Foreign Debts, Senator Clifford Ordia at plenary.

The recommendation of the Committee: “That the Senate do approve the under listed ongoing negotiation of external borrowing in the sum of $16,230,077,718, €1,020,000,000.00 and a grant component of $125,000,000.00 under the 2018-2020 External Borrowing (Rolling) Plan” was approved by Senators when it was put to a voice vote by Senate President Ahmad Lawan at plenary.

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The Senate also approved the request to the Bank of Industries for the issuance of €500 million but no more than €750 million Eurobond in the International Capital Market.

However, the Senate demand the terms and conditions of the loan from the funding agencies, be forwarded to the National Assembly prior to its execution for approval and proper documentation.

Senator Ordia representing Edo Central, in his presentation, said President Buhari’s request complied with the provisions of the Debt Management Office (Establishment) Act 2003 and the Fiscal Responsibility Act 2007.

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He also added that the provisions of the Acts support the President to seek and obtain the approval of the National Assembly in respect of the External Borrowing Programme of the Federation and States.

“The committee notes that a good number of the projects in respect of which financing is being requested under the 2018-2020 external borrowing (rolling) plan are mostly ongoing projects and programmes in respect of which external borrowed funds have been spent in the past, including loans and grants,” Mr Ordia said.

Mr Ordia said the projects are geared towards stimulating a rebirth of commercial and engineering activities to boost tax revenue payable to the government.

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He further told the Senate that only 10 per cent of the $22.8billion approved by the national assembly under the 2016-2018 external borrowing rolling plan was disbursed to Nigeria.

He explained that the projects will have a great multiplier effect in stimulating growth through infrastructure development, job creation, poverty alleviation, health care and improving our security architecture.

The loans will be funded by the World Bank, African Development Bank and the French Development Agency (AFD), Mr Ordia said.