The Senate and House of Representatives have approved a $2.2 billion loan request from President Bola Tinubu, aimed at addressing the budgetary deficit for 2024.
The legislative endorsement followed deliberations on reports presented by the committees on local and foreign debt during their respective plenary sessions on Thursday.
The loan, amounting to approximately ₦1.7 trillion using an exchange rate of ₦800 to a dollar, is intended to bridge the ₦9.1 trillion deficit in the 2024 national budget.
According to chairman of the Senate committee on local and foreign debts,Aliyu Wamakko, the funds will be sourced through financial instruments such as Eurobonds and Sukuk to optimize efficiency and manage costs.
President Tinubu initially forwarded the loan proposal to the National Assembly earlier in the week, seeking expedited approval.
The federal executive council had previously greenlit the borrowing plan as part of its broader strategy to stabilize Nigeria’s economy and implement critical reforms aimed at fiscal sustainability.
Providing additional clarity on the financial structure, Minister of Finance and Coordinating Minister of the Economy, Wale Edun, highlighted that approximately $1.7 billion of the loan would be secured via a Eurobond issuance, while another $500 million would come from Sukuk financing, catering to investors interested in Sharia-compliant bonds.
Edun emphasized that the borrowing process is scheduled to commence within the current fiscal year.
However, the ultimate modalities, including the timing and terms of the funding arrangement, will be influenced by prevailing market conditions and recommendations from transaction advisers.
This move comes against the backdrop of Nigeria’s proposed ₦47.9 trillion total expenditure for the 2025 fiscal year, as the government seeks innovative financing methods to address the growing demand for infrastructure development and economic reforms.
The borrowing strategy reflects the administration’s determination to tackle structural challenges while leveraging external funding sources to meet fiscal targets and drive sustainable growth.
