Senate approves Buhari’s $5.513bn external loan request

President Muhammadu Buhari’s $5.513 billion external loan request to finance the revised 2020 budget, has been approved by the senate.

Though the senate stood down a component of loan which the federal government said will help in execution of its priority projects and for projects to support State Governments in stimulating their economy which has been adversely affected by the COVID-19 pandemic on grounds of lacking requisite details, the loan request was however approved after presentation and consideration of the report of the Senate Committee on Local and Foreign Debts.

Lenders for the federal government’s priority projects as approved by the Senate are: the AfDB – $125million to strengthen healthcare system and improve response to COVID-19 and $23 million for financing smallholder farmers to mitigate food security impact of the COVID-19 Pandemic, $600million from the Islamic Development Bank to support Nigeria’s response to challenges posed by COVID-19 and $500 million from the African Export-Import Bank to provide critical Medical supplies to combat COVID-19.

The Federal Government’s intention of borrowing €995million from the Export-Import Bank of Brazil to support Green imperative and enhance the mechanisation of agriculture and agro-processing in Nigeria, was put in abeyance by the upper chamber.

The $500 – $750 million also being negotiated with the World Bank for State Fiscal Transparency and Sustainability Program to provide fiscal support to the States was not approved.

The ongoing negotiation by the Federal Government with the World Bank for between $500million – $750 million for COVID-19 Action Recovery and Economic Stimulus Program to support state-level efforts to protect livelihoods, ensure food security and stimulate economic activities, is also yet to be approved.