The Senate on Tuesday approved a $5.5 billion loan request by President Muhammadu Buhari to finance deficits in the 2017 budget and refinance domestic debts.
This is coming 41 days after he wrote the lawmakers on the matter.
Buhari had in a letter dated October 4, 2017, asked for the Senate approval over his administration’s plan to secure two external borrowings totaling $5.5 billion.
The request had met a lot of criticism with even the opposition Peoples Democratic Party (APC) accusing Buhari’s government of mortgaging the future of Nigeria through his government’s borrowings.
However, the Senate on Tuesday following the adoption of a report by the Senate Committee on Local and Foreign Debts at its plenary approved the loan request.
Chairman of the Senate committee on Local and Foreign Debts, Senator Shehu Sani, said a total of $2.5 billion will be spent on capital projects in the 2017 budget, while $3 billion will be expended on local debt refinancing.
Sani in his report, said the approval of the loan will assist the government in funding rail, road and other projects in the country. He said the government will also reduce the nation’s debt burden when it refinances local debts with funds sourced from foreign financial institutions.
Deputy President of the Senate, Ike Ekweremadu, who presided, warned the Debt Management Office (DMO) to ensure that the nation’s debt profile is not overblown.
Ekweremadu said: “The implementation of the 2017 budget is key. An appropriation act is useless if it is not implemented. Let me say that we need to urge the DMO to ensure that our debt profile is watched and that we do not exceed or overblow our debt.”
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