During Plenary on Thursday 28 May, the Speaker of the House of Representatives, Femi Gbajabiamila read a letter from the President, Muhammadu Buhari seeking an approval for new borrowing of $5.51 billion.
The new borrowing is said to be used for funding of capital projects, providing financial support for states’ projects in the 2020 budget and will be sourced both locally and internationally.
This new loan request will add to the increasing indebtedness of the Nigerian government. Recently National Assembly approved a loan request of N850 billion for the Federal Government in addition to the $22.79 billion approved by the Senate earlier this year.
On 28 April, The International Monetary Fund (IMF) approved $3.4 billion loan to help Nigeria address the impact of Covid-19.
Read more; IMF approved $3.4 billion for Nigeria
According to the data on FMDQ website, Nigeria’s current public debt is N28.57 trillion as at Thursday 28 May. The new borrowing request will be equivalent to N1.98 trillion using CBN’s official exchange rate of N360/$1.
The new amount which FG is seeking an approval for, represents about 6.94% of the total current public debt.
Thus, increasing the total public debt to N30.5536 if it is approved and borrowed.
The revised budget N10.5 trillion 2020 budget was also sent to the house for approval. The speaker of the House during the plenary read a letter of communication from President Muhammadu Buhari, seeking approval for the revised 2020-2022 mid-term expenditure framework (MTEF) as “it is necessary due to the sharp cut in the global oil price as well as drop-in local oil production.”
President @Mbuhari is also seeking the House approval to borrow locally & internationally to finance capital projects as well as finance projects to support state governors in the 2020 budget
The letter was referred to the House Committee on loans & debt management. #HousePlenary
— House of Reps NGR (@HouseNGR) May 28, 2020