Finally, Senate says yes to Buhari’s $5.5bn external borrowings request

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Whereas President Muhammadu Buhari was in far away Ebonyi State on a State visit, the Senate on Tuesday, approved his request to secure two external borrowings totalling $5.5bn.

The approval came after the adoption of a report by the Senate Committee on Local and Foreign Debts at the plenary.

It would be recalled that Buhari, had in a letter dated October 4, 2017, said the external borrowings had been captured in the 2017 Appropriation Act, which has a deficit of N2.356tn and provision for new borrowings of N2.321tn.

However, World bank, financial experts and Africa Development Bank (AfDB), had  at various occasions cautioned against further borrowing due to available indices showing that rising debt profile is getting above allowable threshold.

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But the Debt management office (DMO), at each of the cautions, averred that the economy is still safe to borrow externally considering the terms and conditions that are favourable after all.

Buhari’s loan request letter read in part; “Accordingly, the Senate is requested to kindly approve the following external borrowings: Issuance of $2.5bn in International Capital Market through Eurobonds or a combination of Eurobonds and Diaspora bonds for the financing of the Federal Government of Nigeria’s 2017 Appropriation Act and capital expenditure projects in the Act.

“Issuance of Eurobond in the ICM and/or loans syndication by the banks in the sum of $3bn for refinancing of maturing domestic debts obligations of the Federal Government of Nigeria, while looking forward to the timely approval of the National Assembly to enable Nigerians to take advantage of this opportunities for funding.”