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Nigeria's Senate gives go-ahead for $5.5 billion foreign borrowing

14 November 2017

Nigeria will move ahead with plans to borrow $5.5 billion from foreign investors after the Senate on Tuesday approved President Muhammadu Buhari request for the move.

The Senate approved after considering the report from its Committee on Local and Foreign debts.

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Buhari in October had written to the Senate, asking for the approval of an External loan of $5.5 billion to enable the Federal government finance the 2017 budget.

Chairman of the Senate committee on Local and Foreign Debts, Senator Shehu Sani, said a total of $2.5 billion will be spent on capital projects in the 2017 budget, while $3 billion will be expended on local debt refinancing.

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In a word of caution, Senator Yusuf Abubakar Yusuf representing Taraba Central said, the Federal Government should properly monitor its foreign exchange, adding that payment of foreign debts exclusively depends on what happened to the foreign exchange rate. However, it will reduce the cost of the debt.

"So we are simply refinancing the payment of the debts".

"The Mamblilla hydro power project which has always been abandoned when completed will add substantially to the national grids thus improve power output of the country".

"Mr President, Distinguished colleagues, the loan cover projects that spread across the six geopolitical zones and those projects were critical to Nigerians, so it should be approved", he said.

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"He listed the projects as the Mambilla Hydropower Project; construction of a second runway at the Nnamdi Azikiwe International Airport; counterpart funding for rail projects and the construction of the Bode-Bonny Road, with a bridge across the Opobo Channel".

He said, "This Senate will continue to partner with the Federal Government in matters that concern the ordinary people of Nigeria".

In his comment, the Senate Leader, Ahmed Lawan, lauded the executive and the Senate for their cooperation in approval of the loan.

The government intends to spend money on infrastructure projects to diversify the OPEC member's oil-dependent economy.

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Nigeria's Senate gives go-ahead for $5.5 billion foreign borrowing