Senate increases Nigeria’s debt burden, approves fresh $1.5bn, €995m foreign loans

The Nigerian Senate on Wednesday increased Nigeria’s debt burden, approving fresh foreign loans of $1.5 billion and €995 million for the government.

The senate gave approval for fresh loans for the Federal and State governments after endorsing the report of the Senate Committee on Local and Foreign Debts on the external borrowing plan of the Federal Government.

Chairman of the Committee, Clifford Ordia, had informed the senators of the committee’s endorsement of the loan request, then, recommended the request for approval.

It was highlighted that the €995 million loan is for agricultural mechanisation in the 774 local governments areas across the country, while the $1.5 billion loan will be utilised to fund critical infrastructure in the post-COVID-19 pandemic period across the 36 states and the federal capital territory.

The International Monetary Fund (IMF), World Bank, African Development Bank Group (AFDB), and Export/Import Bank of Brazil were identified to be facilitating the loans.

Meanwhile, the Nigerian government is still contending with the increasing public debt burden of N32.22 trillion as at September 30, 2020, which is taking a chunk of the national budget to the sum of about N2.7 trillion for debt servicing every year.