The loan, part of the administration’s 2025–2026 borrowing plan, also includes additional domestic and foreign funding sources aimed at financing key national infrastructure, security operations, and development projects.
By Deborah Hassan
365Daily – Senate on Tuesday approved President Bola Tinubu’s request to borrow over $21 billion, including a $3 billion allocation for the long-neglected Eastern rail line linking Port Harcourt to Maiduguri.
The loan, part of the administration’s 2025–2026 borrowing plan, also includes additional domestic and foreign funding sources aimed at financing key national infrastructure, security operations, and development projects.
The full borrowing package comprises $21.19 billion in direct foreign loans, €4 billion (Euro), ¥15 billion (Japanese Yen), $65 million in grants, ₦757.9 billion in domestic bonds and $2 billion in capital raised through a foreign currency instrument issued locally.
Senator Aliyu Wamakko, Chairman of the Senate Committee on Local and Foreign Debt, presented the report, which had been pending since May 27 due to documentation delays from the Debt Management Office (DMO).
Senator Olamilekan Adeola, Chairman of the Appropriations Committee, said the loans had already been factored into the 2025 budget and Medium-Term Expenditure Framework (MTEF).
“With this approval, we now have all revenue sources, including loans, in place to fully fund the budget,” he said.
Senator Sani Musa explained that disbursement would take place over six years. “There’s no economy that grows without borrowing. What we are doing is in line with global best practices,” he said.
Banking Committee Chairman, Senator Adetokunbo Abiru, said the loans are concessional and long-term, some with tenors of up to 35 years. “They comply with the Fiscal Responsibility Act and are tied to capital and human development,” he said.
A key highlight of the loan is the $3 billion earmarked for the Eastern rail line — a move welcomed by senators from the South East and South South regions.
“This is the first time I’ve seen $3 billion allocated to rebuild the eastern line. That alone justifies my full support,” said Senator Victor Umeh (Anambra Central), who described it as a “historic step” for regional connectivity and economic development.
The Port Harcourt–Maiduguri railway had long been abandoned, leaving the Eastern corridor without modern rail infrastructure.
Despite broad support, some lawmakers raised red flags about transparency. Senator Abdul Ningi (Bauchi Central) said the plan lacked details on allocations to states and agencies.
“We need to tell our constituents exactly how much is being borrowed in their name, and for what purpose,” he said.
Other projects listed in the loan package include power plants and digital infrastructure, agricultural and housing projects, security funding for operations across the country.
Deputy Senate President Jibrin Barau said the loan reflects equitable distribution. “This shows that the Renewed Hope Agenda is working. No region is left out,” he said.
Senate approves $2bn domestic dollar bond, pension debt clearance
The Senate also approved a separate request to raise up to $2 billion through a foreign-currency-denominated bond issued in Nigeria’s local debt market.
The programme, enabled by Executive Order No. 16 of 2023, is aimed at harnessing dollar liquidity from local private sector investors, diaspora remittances, and foreign-owned firms operating in Nigeria — without exerting pressure on the country’s foreign reserves.
According to the debt committee, the proceeds will be ring-fenced for sectors with high growth potential such as power, transport, and digital connectivity.
Lawmakers also gave the go-ahead for the issuance of ₦757.9 billion in bonds to settle outstanding pension liabilities under the Contributory Pension Scheme as of December 2023.
Although the new borrowing will increase Nigeria’s total debt stock, the Senate emphasised that the long-term benefits to infrastructure and economic growth justify the decision.