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Buhari overlooks N33tr debt burden, seeks fresh N2tr loans

Amid concerns over debt overhang, President Muhammadu Buhari has requested the Senate to consider and approve an external borrowing plan amounting to about N2.5 trillion to fund projects captured under the 2018-2021 borrowing projections. If approved, the country’s documented national debts will balloon to over N35 trillion.

The Senate President, Ahmad Lawan, read the letter dated August 24, 2021, during plenary in Abuja, yesterday.

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Buhari, in the letter, explained “that the projects listed in the 2018-2021 Federal Government Borrowing Plan were to be financed through sovereign loans from the World Bank, French Development Agency (AFD), Export-Import Bank of China, International Fund for Agricultural Development (IFAD), Credit Suisse Group and Standard Chartered/China Export and Credit (SINOSURE).”

“The amount is in the sum of $4.05 billion, €710 million and a grant component of $125 million. The money, the President explained, would be used to fund federal and state government projects across key sectors such as infrastructure, health, agriculture and food security, energy, education and human capital development, as well as the COVID-19 response initiative.”

“The strategy of borrowing long, and restructuring of the domestic debt portfolio by refinancing matured treasury bills with longer tenor securities lengthened the Federal Government bond yield curve up to 30 years within the period and was critical to the successes recorded,” DMO said in the appraisal.

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