The National Assembly on Tuesday granted President Muhammadu Buhari’s requests of $28.2bn in external borrowings from multilateral financial institutions and bilateral partners.
Approvals for the loans came from the Senate and the House of Representatives.
While the Senate approved the President’s $5.51bn request for priority projects and combating COVID-19, the House of Representatives approved $22.7bn which was suspended last year.
The House had suspended the loan request following criticisms by some lawmakers from the South-east who alleged the exclusion of the region from the loan meant to finance key infrastructures in Nigeria.
But after much plea from the Speaker of the House, Femi Gbajabiamila, who admitted that issues raised concerning the loan application could not be resolved legally, as agreements were sealed, noting, “it is either we approve wholesale or not approve” the loan was approved.
Gbajabiamila said further, “For the first time, we added a clause specifying certain projects. We met and demanded for the commitment of the executive that these projects must be considered in the next borrowing plan and we got their words.
“I am only seeking for the understanding of our colleagues from the North-East and South-East. All of us will agree that there is a massive wide infrastructure deficit in this country and we need to bridge that gap.”
Meanwhile, Senate Chairman, Committee on Local and Foreign Debts, Clifford Ordia, said his committee had considered all aspects of the loan request before recommending it for approval.
Ordia said, “The committee observed that the financing is being sourced from multilateral and bilateral global donor lenders and partners with proven track record of previous financial accommodation and support to the Federal Government.
“The committee notes that as regards the IMF loan, there are no usual onerous conditions for borrowing, such as currency devaluation and deregulation of certain sectors of the economy attached to this loan.
“The committee notes that the borrowings are largely concessional loans with low interest rates and very long moratorium and payback period.”
According to the Presidency, the loan became necessary as part of reviewing the 2020 budget in order to cushion the effects of the sharp drop in oil revenues and the COVID-19 pandemic.