Senate approves Buhari’s $8.3bn loan

From Fred Itua, Abuja

Senate, yesterday, approved President Muhammadu Buhari’s request for ongoing external loans to the tune of $8,325,526,537 and €490,000,000 under the 2018-2020 External Borrowing (Rolling) Plan.

The approval followed the consideration of a report on the 2018 to 2020 External Borrowing (Rolling) Plan by the Committee on Local and Foreign Debt.

Chairman of the Committee, Clifford Ordia, in his presentation, said the panel noted with utmost importance, the genuine and very serious concerns of Nigerians about the level and sustainability/serviceability of the country’s borrowings in the last decade.

According to the lawmaker, “our (Nigeria’s) debt service figures constitute a huge drain on our revenue to the extent that it account for over 30 percent of our expenditure in the annual budget.”

He said due to the shortfall in the country’s annual revenues in relation to the need for rapid infrastructure and human capital development, “we have had to pass deficit budget every year, requiring us to borrow to finance the deficit in our budget.”

Ordia said out of the total borrowing request of $36,837,281,256 contained in the re-forwarded request of Mr. President, $26,154,536,533 is for funds proposed to be borrowed from various financial institutions from the Peoples Republic of China.

He said the proposed projects in the ministries of Transportation, FCT, Aviation, Works and Housing, Agriculture and Water Resources and some commissions, such as National Universities Commission, North East Development Commission and the National Identity Management Commission, are mostly ongoing projects and programmes in respect of which external borrowed funds have been spent in the past, including loans.

“These projects have a great multiplier effect on stimulating economic growth through infrastructure development, job creation and poverty alleviation, stimulation of commercial and engineering activities and the consequent tax revenues payable to government as a result of these productive activities,” Ordia said.