Senate Approves FG's $5.5bn Borrowing Plan

Leslie Hanson
November 14, 2017

The Senate has approved the request by President Muhammadu Buhari for the Federal Government to borrow $5.5 billion.

"That the Senate do receive and consider the report of the Committee on local and Foreign Debts on the issuance of USD2.5 billion to finance the 2017 appropriation Act and USD3.0 billion to refinance domestic debts", Sani submitted.

The President's request, which included external loan of $3 billion and the issuance of a $2.5 billion Eurobond in the global Market was approved by the Senate on Tuesday.

In a word of caution, Senator Yusuf Abubakar Yusuf representing Taraba Central said, the Federal Government should properly monitor its foreign exchange, adding that payment of foreign debts exclusively depends on what happened to the foreign exchange rate. "If our foreign exchange rate goes to N500/USD1, we are going to have a very serious problem on generating enough foreign exchange to pay the foreign debts". With the $3bn to be used for refinancing domestic debts, local lenders owed by the federal government may now expect to be paid. He added that the $2.5 billion will create more borrowing space for the private sector.

"The construction of the second runway of the Nnamdi Azikiwe worldwide airport will enhance the safety of the air passengers, increase the use of airports by global airlines thus increase the revenue of the government". However, it will reduce the cost of the debt.

"If we consider the projects that these loans are proposed to cover, you will all agree that they are spread across the geo-political zones of Nigeria". This Senate is known to be working together for the benefit of all Nigerians.

"He listed the projects as the Mambilla Hydropower Project; construction of a second runway at the Nnamdi Azikiwe International Airport; counterpart funding for rail projects and the construction of the Bode-Bonny Road, with a bridge across the Opobo Channel".

Senate leader, Senator Ahmed Lawan while supporting Ashafa's position also claimed that the federal government had complied with all laws governing external borrowing. He added that he was confident that the infrastructure projects to be executed with the sums borrowed would have a major impact on the economy.

Other reports by Iphone Fresh

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