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Buhari Begs to Borrow $4.179 Billion and €710 Million External Loans

President Muhammadu Buhari has written to the Senate to obtain approval for $4.179 billion and €710 million external loans. The president said the loans will be deployed to service capital projects across the country. Buhari said the loan approval request is additional upon the earlier request made in May under the 2018-2021 Federal Government Borrowing Plan.

In May, Buhari wrote to the Senate and requested approval to borrow $6.1 billion from the international capital market and this was approved before the Upper House went on vacation in July. The president’s recent letter is dated August 24, 2021 and read on the floor of the Senate by Senate President, Dr. Ahmad Lawan.

Broken down, the president is seeking to borrow $4,054,476,863 and €710,000,000 as well as a grant of $125,000,000. The presidency said the loans will be borrowed from the World Bank, French Development Agency (AFD), China-Exim Bank, International Fund for Agricultural Development (IFAD), Credit Suisse Group, and Standard Chartered/China Export and Credit (SINOSURE).

Buhari explained that the loans will be used to address state and national challenges in the health, agriculture, education, energy, and human capital sectors. He said the loans will boost job creation, reduce poverty, and enhance COVID-19 response efforts. He added that the loan will facilitate the achievement of the Nigeria Economic Sustainability Plan across all sectors.

But the PDP has condemned the fresh borrowing effort of the APC-led government. The PDP National Publicity Secretary, Kola Ologbondiyan, said Buhari and his APC administration want to cripple the Nigerian economy with their purposeless borrowings. He said Buhari’s government currently owes N33.107 trillion and the current borrowing effort will put the country at a debt of over N40 trillion.

“Our party holds it as an act of wickedness that individuals who know that they will be leaving office in less than two years will be accumulating debts instead of seeking ways to reduce the liability they have brought upon our nation,” the PDP wrote.

The opposition party also accused the current administration of borrowing without a good repayment plan in place. “The APC knows it will not be around after May 29, 2023,” the PDP stated. “That is why it is pushing our nation into deeper economic quagmire with foreign loans, which are largely diverted to personal pockets of their corrupt leaders.”