Senate Okays Buhari’s $5.513bn External Loan Request

The Senate has approved President Muhammadu Buhari’s $5.513 billion external loan request, following the  consideration and adoption of the report of the Senate Committee on Local and Foreign Debts. 

The Senate made the approval on Tuesday during the plenary session.

In a statement signed by the Special Assistant (Press) to the  President of the Senate, Ezrel Tabiowo, the Chairman of the Committee, Clifford Ordia, (PDP – Edo Central), said the Federal Government would source $3.4 billion at one percent interest rate from the International Monetary Fund (IMF) for Rapid Financing Instrument to part finance the 2020 proposed revised budget.

According to him, $1.5 billion would be sourced from the World Bank for Development Policy Financing of the revised 2020 budget at 2.38% interest rate.

He added that  $500 million would be borrowed from the African Development Bank (AfDB) for COVID-19 crises response budget support operation to finance revised budget deficit at 1.315%  interest.

The remaining $113 million would be raised from the Islamic Development Bank (IsDB)  to finance part of the revised 2020 budget at 0.4% interest.

The Committee maintained that the  $5.513 billion loan request was basically to facilitate the financing of the revised 2020 budget deficit. 

According to the Committee the loans were to help cover for revenue shortfalls resulting from coronavirus. The report also added that it would help mitigate the impact of the virus on the country’s economy.

The report said that the Local and Foreign Debts Committee, in agreement with the Ministry of Finance, Budget and National Planning, Departments and Agencies of Government, resolved to “conclude the consideration of the other two outstanding components of Mr. President’s External Borrowing request relating to Funding of Priority Projects of the Federal Government to be captured in the Budget estimates for 2021 and Facilities to support State Government to face the challenges of the COVID-19 pandemic.”

THE WHISTLER had earlier reported that the Senate reviewed oil price benchmark upward to $28 per barrel from $25 per barrel and also passed the amended 2020-2022 Medium Term Expenditure Framework/Fiscal Strategy Paper. 

The Committee report said, “the Appropriation Act (Amendment) Bill 2020 contains a revised total budget of N10.594 trillion with a deficit of N4.563 trillion which will be part financed by proposed domestic borrowing of N2.188 trillion and external borrowing of N1.984 trillion.”