The Nigerian Senate has approved President Bola Tinubu’s external borrowing plan of over $21 billion for the 2025-2026 fiscal cycle. This significant development is expected to boost the country’s economic growth and development. The loan package includes $21.19 billion in direct foreign loans, €4 billion, ¥15 billion, a $65 million grant, and domestic borrowing through government bonds totaling approximately ₦757 billion.
The Senate-approved loan will be disbursed over a six-year period, with a focus on critical sectors such as infrastructure, agriculture, security, power, housing, and digital connectivity. Notably, $3 billion has been allocated to revitalize the Eastern Rail Corridor, stretching from Port Harcourt to Maiduguri. Senator Victor Umeh, representing Anambra Central, praised the initiative, stating, “This is the first time I’ve seen $3 billion allocated to rebuild the eastern rail line. That alone justifies my full support”.
While the approval drew broad support, some lawmakers expressed concerns over transparency and equitable distribution. Senator Abdul Ningi (Bauchi Central) cautioned that Nigerians deserve to know the specifics of the loans and their intended impact. “We need to tell our constituents exactly how much is being borrowed in their name, and for what purpose,” he emphasized. In response, Senator Sani Musa clarified that the loan disbursement would span six years, not just 2025, and emphasized that Nigeria has not defaulted on any of its existing loan repayments.
The borrowed funds will be used to finance critical development projects nationwide, including investments in infrastructure, security, agriculture, and human capital development. Senator Olamilekan Adeola, Chairman of the Appropriations Committee, noted that most of the loan requests had already been factored into the Medium-Term Expenditure Framework and the 2025 budget. “The borrowing is already embedded in the 2025 Appropriation Act. With this approval, we now have all revenue sources, including loans, in place to fully fund the budget,” Adeola explained.
The Senate leadership emphasized that all disbursed funds must be used strictly for capital and developmental projects, in line with public finance regulations. Senator Adetokunbo Abiru, Chairman of the Senate Committee on Banking, Insurance, and Other Financial Institutions, assured that the loans are concessional, with terms ranging from 20 to 35 years, and are strictly tied to capital and human development projects.
