President Bola Tinubu has asked the National Assembly to accept new borrowing of roughly $7.7 billion. In order to partially cover the 2026 budget deficit.
Senate President Godswill Akpabio has stated that this request “effectively supersedes an earlier borrowing proposal of $20.3 billion.”
During Wednesday’s plenary, Akpabio read Tinubu’s plea, which was contained in a letter dated October 26, 2026.
At the budget exchange rate of N1,409 to the dollar, the president is requesting clearance for an external loan of N10.79 trillion, or almost $7.7 billion.
In the letter, Tinubu said the request was made pursuant to Sections 21(1) and 27(1) of the Debt Management Office Establishment Act, 2003.
Section 21(1) provides that no external loan shall be approved or obtained by the Minister of Finance unless its terms and conditions are presented to the National Assembly and approved through a resolution.
Section 27(1) also empowers the National Assembly to approve, by resolution, standard terms and conditions for negotiating and accepting external loans and issuing guarantees.
Tinubu said the 2026 Appropriation Act approved N29.2 trillion in new borrowing to finance a budget deficit of approximately N31.4 trillion.
The borrowing requirement comprises N18.4 trillion in domestic loans and N10.79 trillion in external financing, with the latest request covering the external component.
Reacting to the letter, Akpabio said it effectively superseded the earlier request for $20.3 billion because the new proposal is more explicit about how the government intends to raise the funds.
“I believe this letter effectively supersedes the earlier request for 20.3 billion US dollars because the present request is more explicit. It also recognises that the borrowing will not necessarily come from one source,” he said.
Akpabio said the government would have to explore available funding options and secure the most favourable terms.
“The government will have to explore the available options and secure the best possible terms under a willing-seller, willing-buyer arrangement,” he said.
The Senate President referred the request to the committee on local and foreign debts to report back as soon as practicable.
HOW TINUBU PLANS TO RAISE THE FUNDS
According to the letter, the federal government plans to raise the $7.7 billion through one or a combination of funding options.
The proposed sources include concessional and commercial loans from multilateral and bilateral institutions, International Monetary Fund (IMF) facilities, bridge financing, direct borrowing from international financial institutions and eurobond issuance.
Tinubu said the options would be pursued simultaneously, taking into account their respective costs, benefits, and the time required to access the funds.
However, he said greater emphasis would be placed on eurobond issuance because it is generally faster to conclude and could raise larger amounts at relatively competitive costs.
“The final terms and conditions, including interest rates and tenures, will be determined at the time of pricing, depending on prevailing market conditions,” the president said.
He added that the federal ministry of finance and the Debt Management Office (DMO) would ensure that Nigeria secured the best possible terms.
Tinubu said the external borrowing would finance priority programmes and projects contained in the 2026 Appropriation Act.
The projects, he said, cover defence and security, transportation, agriculture, power, education and healthcare.
The president also said the borrowing is expected to support the country’s external reserves because the funds would be received by the Central Bank of Nigeria (CBN) on behalf of the federal government.
“This, in turn, is expected to support the stability of the naira,” he said.
Tinubu asked the National Assembly to authorise the federal government to implement the N10.79 trillion external borrowing and approve the use of one or more of the identified funding sources, with greater emphasis on eurobond issuance.
He also urged the legislators to empower the Minister of Finance and the Coordinating Minister of the Economy to work with the DMO to implement the resolution.
He expressed the expectation that the Senate would issue the necessary resolution promptly.
