In a significant fiscal development, the Nigerian Senate has officially approved President Bola Ahmed Tinubu’s request to secure an extensive external loan valued at over $21 billion. The decision comes as part of ongoing efforts to finance critical infrastructure and address budgetary shortfalls within the country.
The comprehensive loan request, submitted through the office of the Chairman of the Senate Committee on Local and Foreign Debt, Senator Aliyu Wamako, includes various components: $21.19 billion in direct foreign loans, €4 billion from European lenders, ¥15 billion in Chinese loans, a $65 million grant from international partners, and additional borrowing from the domestic market, estimated at ₦757 billion through government bonds.
Another key component of the package is a provision to raise up to $2 billion through a foreign-currency instrument to be issued within the domestic capital market. This is aimed at tapping into new funding sources while balancing the nation’s debt portfolio.
According to Senator Wamako, the initial loan proposal had been sent to the National Assembly as far back as May 27, 2025. However, deliberations on the request faced delays due to the Senate’s recess period as well as documentation challenges from the Debt Management Office (DMO). With those issues now resolved, the Senate was able to move forward with its consideration and final approval.
During the plenary session, Senator Olamilekan Adeola, Chairman of the Senate Committee on Appropriations, emphasized that the approved loans were critical to fully executing the financial plans outlined in the federal government’s 2025 fiscal framework.
“With this approval, all revenue sources, including external and domestic borrowing, are now in place to ensure full funding of the 2025 Appropriation Act,” Senator Adeola remarked, noting that the loan aligns with broader macroeconomic targets and capital expenditure projections.
The approval is expected to boost confidence in the federal government’s capacity to deliver on its 2025 budget commitments, including investment in infrastructure, power, transportation, and healthcare. Nevertheless, analysts warn that Nigeria’s growing debt profile must be carefully managed to avoid long-term fiscal risks.