Home New loan Senate approves Buhari’s $ 6.1 billion loan request

Senate approves Buhari’s $ 6.1 billion loan request


The Senate approved President Muhammadu Buhari’s $ 6.1 billion loan request.

The loan request of $ 6.1 billion, which is equivalent to about 2,343 billion naira, was approved on Wednesday after the Senate considered the report of the Senate Committee on Local and Foreign Debt.

Committee Chairman Clifford Ordia presented the report.

Mr. Buhari had, in May, asked the National Assembly to approve the loan.

The loan, he said, will be obtained through multilateral and bilateral tenders as well as on the international capital market.

He also revealed that the National Assembly had already approved the borrowing of 4.6 trillion naira in the 2021 budget law. And that the new borrowing of 2.3 trillion naira will partially finance the 2021 budget deficit.

In his presentation, Mr. Ordia said the request is not new as it was approved in the borrowing plan when the National Assembly adopted the 2021 budget.

“What we are about to spend is not a new loan, it was approved in the 2021 budget,” he said.

After the approval, Senate Speaker Ahmad Lawan said the National Assembly must ensure that there is no frivolous spending on the part of the executive.

“Let me thank the committee, this is not a new loan. This is a borrowing plan that we have approved. What we have done is provide the resolutions necessary for its implementation.

“Every penny counts. Our committees must be alive to watch it. No frivolous expense should be considered.

Nigeria’s 2021 budget already has a deficit of 5.6 trillion naira.

The president said the loan would be used to finance “projects in priority sectors of the economy, namely: electricity, transport, Agriculture and rural development, education, health, provision of counterpart funds for multilateral and bilateral projects, defense and water resources.

READ ALSO: Senate Approves Buhari’s $ 1.5 Billion External Loan Request, € 995m

The approval of the president’s loan request comes amid Nigeria’s growing deficit and debt crisis.

Mr Buhari had, in October, acknowledged that the deficit in the proposed budget was above the three percent threshold established by the 2007 Fiscal Responsibility Act.

He said the measure was necessary because of the “existential challenge of the coronavirus pandemic and its consequences; I think that provides a rationale for exceeding the threshold as provided for in this law. “

In April, the National Assembly approved loan requests of $ 1.5 billion and € 995 million for the Buhari administration.

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