₦10.79tn Foreign Loan Request: Senate Takes First Step on Tinubu’s Proposal
President Bola Tinubu’s proposed $7.7 billion foreign loan request has reached the National Assembly, with the Senate taking its first formal step towards considering the ₦10.79 trillion borrowing proposal.
The lawmakers on Wednesday referred the President’s request to the Committee on Local and Foreign Debts for detailed examination, following its presentation during plenary.
Tinubu’s request, contained in a letter dated October 26, 2026, was addressed to Senate President Godswill Akpabio, who read its contents before lawmakers.
In the correspondence, the President sought legislative approval to secure $7,707,404,882.49, equivalent to ₦10,790,366,835,481, using the approved budget exchange rate of ₦1,400 per dollar.
The proposed foreign borrowing forms part of the Federal Government’s 2026 financing strategy, which is expected to address a projected budget deficit of approximately ₦31.4 trillion.
According to Tinubu, the 2026 Appropriation Act provides for ₦29.2 trillion in new borrowing, comprising ₦18.4 trillion from domestic sources and ₦10.79 trillion externally.
The President explained that the financing arrangement would provide additional resources for implementing government programmes and projects captured in the current fiscal year’s budget.
Government Considers Eurobond Issuance
Explaining the proposed borrowing strategy, Tinubu said the Federal Government would explore different international financing opportunities while considering their costs, benefits and accessibility.
He indicated that Eurobond issuance would receive particular attention because of its relatively faster processing time and potential to generate substantial funds under favourable conditions.
Other financing options identified in the presidential request include concessional and commercial loans from multilateral and bilateral institutions, International Monetary Fund facilities and syndicated borrowing.
The government also intends to consider bridge financing arrangements through book runners and direct borrowing from international financial institutions to meet its funding requirements.
However, Tinubu acknowledged that the eventual interest rates, repayment periods and other loan conditions would depend on prevailing market conditions when agreements are concluded.
He assured lawmakers that the Ministry of Finance and the Debt Management Office would work together to negotiate favourable borrowing conditions for Nigeria.
Defence, Agriculture, Education to Benefit From Loan
On the proposed utilisation of the funds, the President identified several critical sectors expected to receive financing through projects captured in the 2026 Appropriation Act.
The priority areas include defence and security, transportation, agriculture, electricity, education and healthcare, which the administration considers important to national development.
Tinubu further argued that the foreign currency proceeds would strengthen Nigeria’s external reserves and provide additional support for the country’s financial position.
He explained that the Central Bank of Nigeria would receive the funds on behalf of the Federal Government, contributing to the country’s foreign exchange reserves.
According to the President, the anticipated increase in reserves would help strengthen Nigeria’s external position and provide additional support for the naira.
Akpabio Urges Caution Over Borrowing Terms
Reacting to the proposal, Senate President Godswill Akpabio stressed the importance of securing favourable conditions before the Federal Government enters any borrowing agreement.
He cautioned against accepting loan arrangements without carefully examining their economic implications, interest rates and repayment obligations.
Akpabio maintained that negotiations with prospective lenders should produce mutually beneficial outcomes while protecting Nigeria’s financial interests.
Following the discussion, he referred the request to the Committee on Local and Foreign Debts and directed members to submit their report as soon as practicable.
The committee is expected to examine the proposed financing arrangements, available borrowing channels and repayment conditions before the Senate takes its final decision.
The latest foreign loan request comes amid continuing concerns about Nigeria’s rising public debt, increasing debt-servicing obligations and dependence on borrowing to finance annual budget deficits.
Although the Federal Government maintains that borrowing remains necessary to address revenue shortfalls and finance critical infrastructure, questions persist about repayment capacity.
Concerns also remain over whether projects funded through additional borrowing will generate sufficient economic returns to justify the financial obligations being accumulated.
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