The Senate on Thursday approved a loan request for $ 2.209 billion, equivalent to an N1.767 trillion loan barely forty – eight hours after receipt of the request from President Bola Ahmed Tinubu.

President Tinubu had on Tuesday in separate letters to both chambers of the National Assembly, requested approval of N1.767 trillion loan as part funding of the N9.7 trillion deficit in the N28.7 trillion 2024 budget.

The request was under the provisions of Sections 21 and 27 Subsection 1, the Debt Management Office established Act 2003, and the approval of the Federal Executive Council.

The Senate upon receipt of the request, mandated its committee on local and foreign debts to expeditiously work on it and report back within 24 hours.

Accordingly, the Chairman of the committee, Senator Aliyu Wammako (APC Sokoto North), during plenary, presented reports on the presidential request for approval.

Senator Wammako in the report, titled” Implementation of New External Borrowing of N1, 767, 610, 321, 779.00 equivalent to $ 2.209billion in the 2024 Appropriation Act through the issuance of Eurobonds and other sources, said the presidential request was very necessary for approval.

He said the requested loan is planned for execution of ongoing projects and programmed in the 2024 Appropriation Act which are critical for growth and development.

His words: “It will contribute to the implementation of the Debt Management Strategy which seeks to reduce the cost of borrowing, lengthen the maturity of the public debt stock, free – up space in the domestic market for other borrowers and help increase Nigeria’s External Reserves”

Senator Wammako added that Nigeria could raise all or part of the New External Borrowing of $ 2.21 billion through the issuance of Eurobonds in the International Capital Market ( ICM).

The Committee as presented by Senator Wammako recommended thus: ” That the Senate do approve the implementation of the New External Borrowing of One Trillion, Seven Hundred and SixtySeven Billion, Six Hundred and Ten Million, Three Hundred Twenty-One Thousand, Seven Hundred and Seventy-Nine Naira (41,767, 610,321,779.00) (equivalent of USD2,209,512,902.22b) at the Budget Exchange rate of USD1.00/800 in the 2024 Appropriation Act and that the amount should be raised from one or more sources.

” Namely; issuance of Eurobonds in the ICM, Issuance of debut sovereign Sukuk in the ICM, & Bridge/ syndicated loans, subject to market conditions. Based on availability and cost, to issue Eurobonds in the sum of USD1.70 billion or more, but not more than USD2,209,512,902,.22b, approved as New External Borrowing in the 2024 Act.

“Given the significant increase in the official exchange rate from USD1.00/800 to approximately 41,640, it is recommended that the exchange rate excess resulting from this adjustment be exclusively utilized for the implementation of capital projects in 2024. This will ensure that additional funds are directed to infrastructure & developmental projects that will contribute to the Nation’s long-term growth and stability”.

The Senate after the presentation of the report, expeditiously approved it at the Committee of the House without any dissenting voice.

In his remarks after the approval, the Deputy President of the Senate, Senator Jibrin Barau who presided over the session, commended the Wammako-led committee for a job well done.

In the last 16 months, President Bola Ahmed Tinubu has borrowed $6.45 billion from the World Bank in 16 months, according to a document on the global lender’s website.

The report shows that the World Bank approved at least 36 loan requests to the Federal Government, estimated at a total of $24.088bn, within five years. The World Bank, on September 26, approved a total of $1.57 billion for Nigeria to strengthen its human capital through better health for women, children, and adolescents.

Part of the support will help to mitigate the impact of climate change (floods and droughts) in Nigeria through improvement in dam safety and irrigation.

According to Ndiamé Diop, World Bank country director for Nigeria: ” Effective investment in the health and education of Nigerians today is central to increasing their future employment opportunities, productivity, and earnings while reducing poverty of the most vulnerable. This new financing for human capital and primary healthcare will help to address the complex difficulties faced by Nigerians, especially women and girls around access and quality of services, but also the governance arrangements that also explain these difficulties” said Ndiamé Diop, World Bank country director for Nigeria.

The International Monetary Fund’s Verdict
The International Monetary Fund (IMF) said that 18 months after implementation, Nigeria’s ongoing economic reforms are still struggling to deliver meaningful results. In specific terms, the IMF said while macroeconomic imbalances had reduced in several countries, Nigeria had yet to show similar progress.

These were contained in the IMF’s latest report on the economic outlook for sub-Saharan Africa that was presented at the Lagos Business School (LBS), the IMF highlighted a mixed performance of economic reforms across the region.

The IMF specifically said that adjustment fatigue, public resistance, and weak communication strategies were undermining the impact of reforms in Nigeria. It, however, noted considerable successes in countries such as Côte d’Ivoire, Ghana, and Zambia, but Nigeria was conspicuously absent from the list of success stories.

The report presented by IMF Deputy Director Catherine Patillo also flagged Nigeria’s struggles with exchange rate stability, thereby highlighting it as one of the worst-performing nations in this regard. Ms. Patillo noted that sub-Saharan Africa’s average economic growth rate is projected to remain at 3.6 percent for 2024, adding however that Nigeria’s growth rate, was pegged at 3.19 percent which falls below this average.

She said: “More than two-thirds of countries have undertaken fiscal consolidation. The median primary balance is expected to narrow by 0.7 percentage points alone in 2024. And these have included notable improvements in Cote d’Ivoire, Ghana, and Zambia, among others”.

The IMF therefore recommended rethinking reform strategies and specifically urged countries like Nigeria to adopt measures that mobilise public support for deep structural changes, saying that it would require greater attention to communication and engagement strategies, reform design, and compensatory measures to rebuild trust in public institutions.