The Senate has approved President Bola Tinubu’s ₦1.77 trillion ($2.2 billion) loan request following a voice vote in favor of the proposal.
Deputy Senate President Barau Jibrin presided over the session, during which the Senate Committee on Local and Foreign Debts, chaired by Senator Wammako Magatarkada (APC, Sokoto North), presented its report recommending the approval.
The loan, submitted by the President on Tuesday, forms part of a fresh external borrowing plan to partially finance the ₦9.7 trillion budget deficit for the 2024 fiscal year.
Tinubu’s request sought National Assembly approval for a ₦1.767 trillion ($2.209 billion) loan as part of the 2024 Appropriation Act.
The new borrowing is expected to further increase the Federal Government’s debt servicing costs. Recent data from the Central Bank of Nigeria (CBN) revealed that $3.58 billion was spent on foreign debt servicing in the first nine months of 2024, a 39.77% rise compared to $2.56 billion during the same period in 2023.
The CBN’s international payment statistics show that May 2024 recorded the highest monthly debt servicing payment of $854.37 million, compared to $641.70 million in July 2023.
This upward trend underscores the growing burden of Nigeria’s foreign debt obligations.
Further breakdown of international debt figures showed that in January 2024, debt servicing costs surged by 398.89 per cent, rising to $560.52m from $112.35m in January 2023. February, however, saw a slight decline of 1.84 per cent, with payments reducing from $288.54m in 2023 to $283.22m in 2024.
March recorded a 31.04 per cent drop in payments, falling to $276.17m from $400.47m in the same period last year. April saw a significant rise of 131.77 per cent, with $215.20m paid in 2024 compared to $92.85m in 2023.
In May 2024, Nigeria’s debt servicing reached its highest point, with $854.37 million spent, marking a 286.52% increase from $221.05 million in May 2023. However, June 2024 experienced a 6.51% decrease, with $50.82 million paid, compared to $54.36 million in the previous year.
July 2024 saw a further reduction of 15.48%, with payments dropping to $542.50 million from $641.70 million in July 2023. In August, payments fell by 9.69%, totaling $279.95 million, down from $309.96 million in 2023. Yet, in September 2024, payments surged by 17.49%, rising to $515.81 million, up from $439.06 million in the same month the year before.
Given the increasing exchange rates, these figures underscore growing concerns about the mounting pressure on Nigeria’s foreign debt obligations.