Senate Approves Tinubu’s $21.8b Loan Plan, N758b Pension Bond Amid Soaring Debt Concerns
THECONSCIENCE NG reports the Senate has approved President Bola Tinubu’s 2025–2026 External Borrowing (Rolling) Plan, which includes requests to borrow $21.8 billion, €2.1 billion and ¥15 billion, as well as a €65 million grant, to finance key projects and programmes across various sectors of the economy.
In addition, it approved the issuance of a N757.98 billion Federal Government bond in the domestic market to offset outstanding pension liabilities under the Contributory Pension Scheme (CPS).
Despite the approvals, debate on the floor was tense. Some lawmakers expressed strong reservations about the sustainability of Nigeria’s mounting debt load.
Meanwhile, to honour the late former President Muhammadu Buhari, the red chamber has scheduled a special session for today, to reflect on his legacy and contributions to national development following his recent passing.
Also approved was the President’s request to raise about $2 billion in the domestic market through a Foreign Currency-Denominated Instrument Local Issuance Programme, a novel initiative backed by Presidential Executive Order No. 16 of 2023, which empowers the Debt Management Office (DMO) to access dollar liquidity within the country without exerting additional pressure on foreign reserves.
These approvals followed the recommendations of the Senate Committee on Local and Foreign Debts, chaired by Aliyu Wamakko. Abdul Ningi (PDP, Bauchi Central) was among the senators who opposed the motion, warning: “Generations after us will continue to pay these loans. I’ve gone through the documents and cannot find a clear repayment plan.”
However, other senators, including Adetokunbo Abiru and Finance Committee Chairman, Sani Musa, defended the proposals, describing the loan terms as flexible and growth-oriented.
Tinubu submitted the borrowing requests on May 27, emphasising the need to support critical projects in infrastructure, health, education, water supply and other strategic areas.
The decision comes at a time Nigeria’s total public debt stock surpassed N121 trillion, with external debts exceeding $43 billion as of mid-2024. Debt servicing now consumes more than 90 per cent of federal revenue, prompting sharp criticism from economists and civil society groups.
“This is a country living on credit,” an opposition lawmaker told journalists. “People are suffering from inflation and joblessness while the government continues to dig deeper into debt.” Still, supporters argue that the borrowing plan was different from past patterns.
“This isn’t reckless borrowing,” a committee member stated. “It’s a strategic investment to stimulate jobs, growth and foreign exchange inflows.”
The approved loans and bond issuances are reportedly ring-fenced for high-impact, high-return projects across power, transport, the digital economy and social sectors, subject to appropriation by the National Assembly.
A significant portion of the N757.98 billion domestic bond is earmarked for the settlement of longstanding pension arrears. The move is expected to bring relief to thousands of retirees still awaiting full payment of their entitlements.
The DMO is expected to float the bond locally, reducing exposure to external risk. However, analysts caution that the government must ensure transparency and fiscal discipline in its execution. Last week, the Federal Executive Council (FEC) held a special session in honour of the former president.
Meanwhile, the Senate has urged Nigerians to disregard unverified social media reports suggesting that the Senate Committee on Constitution Review has recommended the creation of new states.
President of the Senate, Godswill Akpabio, issued the clarification during plenary, following concerns raised by Ningi over widespread misinformation regarding state creation.
Akpabio explained that although over 42 proposals had been received regarding the creation of new states, none had gone through the complete legislative process required.
Cautioning communities against premature mobilisation and meetings over non-existent new states, he urged the public to rely solely on official communications from the National Assembly regarding constitutional amendments and related matters.
