Nigeria’s Senate has approved President Muhammadu Buhari’s request of 1.5 billion US Dollars and 995 million Euros (about 1 trillion Nigerian Naira) in external loans.
President Buhari got the approval for the foreign borrowing after the Senate Committee Local and Foreign Debts presented its report on Tuesday.
Chairman of the committee, Clifford Odia told country’s lawmakers that the panel had considered the loan request and was recommending its approval.
The €995 million loan is meant for agricultural mechanisation across the 774 LGAs while the $1.5 billion loan will be used to execute priority projects and support state governments the federal capital territory in the aftermath of the COVID-19 pandemic.
Mr Ordia had noted in his presentation that the borrowings are largely concessional loans with low interest rates and a reasonable moratorium and payback period.
“No unusual or onerous conditions attached and the terms of the loans and do not in any manner, compromise the sustainability of the Nigerian economy or impugn the integrity and independence of Nigeria as a sovereign nation,” he said.
Experts continue to express worry as Nigeria continues struggling under the weight of increasing public debt stock which stood at N32.22 trillion as of September 30, 2020.
While Nigeria has already borrowed to fund her budget and ‘boost’ the economy, the country plans to sell some national assets to raise funds. The country is also considering borrowing money from dormant bank accounts and retirement savings as well tightening its tax revenue streams.