External Loan Rises to $15.4bn as Senate Approves More $5.5bn Foreign Loan

Nigeria’s foreign debt profile hit as much as N4.694 trillion ($15.40 billion) according to the latest data made public by the Debt Management Office (DMO).
The total debt profile for the country as at September is however N20 trillion.
This was as the Senate approved a fresh external loan of $ 3 billion from the international capital market (ICM) and another $2.5 billion from multilateral donor institutions for the purpose of funding part of this year’s budget.
The approval was based on the request by the executive.
While approving the loan, the Deputy President of the Senate, Senator Ike Ekweremadu, who presided urged the DMO to monitor Nigeria’s debt profile so that the country does not borrow above required limit.
Ekweremadu assured that the Senate will continue to partner with the federal government on matters that concern the ordinary people of Nigeria, adding “the implementation of the 2017 budget is key because any Appropriation Act that is not implemented is worthless”.
However Senator Yusuf Abubakar Yusuf (Taraba APC) called on the executive to be cautious in its borrowings so that the nation’s foreign reserves and foreign exchange rate stability are not affected.
Yusuf said, “If our foreign exchange rate is very low, if it fall as low as N500 to a dollar, we are going to have a very serious challenge generating enough foreign exchange to pay our foreign debt.
“We have to be seen to be a lot more cautious, not just saying that the interest rate (for external borrowing) is low and the cost of refinancing the loan will be low.
“We must also take cognisance of the fact that whatever happens will have an impact on our foreign exchange rate,”
However, Senator Gbenga Ashafa (Lagos APC) described the loan as critical to the success of the 2017 budget.
Ashafa said, “If we consider the projects that these loans are supposed to fund, they are spread across all the geopolitical zones. They covers power, rail, roads, water and others.”
President Muhammadu Buhari had approached the Senate with the loan request about a month ago to enable government finance the Mambilla hydropower project, second runway at the Nnamdi Azikiwe International Airport, Abuja, construction of the Bodo-Bonny road and counterpart funding for rail projects,

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