The House of Representatives has approved President Bola Tinubu’s request to obtain $2.35 billion in external loans to help bridge Nigeria’s 2025 budget deficit.
The Lawmakers also gave the green light for the issuance of a $500 million sovereign sukuk in the international market to support infrastructure projects and diversify government funding sources.
The approvals came after the adoption of a report by the House Committee on Aids, Loans, and Debt Management during its plenary session.
According to the 2025 Appropriation Act, the House endorsed the implementation of N1.84 trillion (approximately $1.23 billion) in new external borrowing, based on a budget exchange rate of N1,500 to the dollar, to partially finance the projected N9.28 trillion federal deficit.
President Tinubu had earlier written to the National Assembly seeking approval in accordance with Sections 21(1) and 27(1) of the Debt Management Office Act, which mandate legislative consent for external borrowing.
In his letter, Tinubu explained that the funds could be raised through Eurobonds, syndicated loans, or bridge financing, depending on prevailing market conditions.
He added that interest rates would likely align with Nigeria’s existing international bonds, currently yielding between 6.8% and 9.3%.
Regarding the $500 million international sukuk, the President said it would attract new classes of investors, deepen the nation’s securities market, and finance key infrastructure projects.
He noted that since 2017, Nigeria had raised over N1.39 trillion through domestic sukuk issuances for major road and capital projects. The planned international sukuk, he added, would complement these efforts, with up to 25% of the proceeds earmarked for refinancing existing high-cost debt.
With these approvals, the Federal Government would proceed with its 2025 financing plans aimed at supporting fiscal stability and infrastructural growth.
