The Senate has approved President Bola Tinubu’s request for a ₦1.77 trillion ($2.2 billion) loan following a voice vote in support
The approval came after the Senate Committee on Local and Foreign Debts, chaired by Senator Wammako Magatarkada (APC, Sokoto North), presented its report.
This loan request, submitted by the President on Tuesday, forms part of a new external borrowing plan to help cover the ₦9.7 trillion budget deficit for the 2024 fiscal year. The funds will be used to address the nation’s growing financial gap, with the total loan request equaling $2.209 billion.
The fresh loan is expected to increase the amount spent on debt servicing by the Federal Government. According to the Central Bank of Nigeria (CBN), $3.58 billion was spent on servicing foreign debt during the first nine months of 2024, marking a 39.77% increase from the $2.56 billion spent in the same period of 2023.
A closer look at the debt servicing data shows significant fluctuations: the highest monthly debt payment in 2024 occurred in May, reaching $854.37 million, a 286.52% increase from $221.05 million in May 2023. Other months also saw notable variations, with January 2024 recording a dramatic 398.89% rise in debt servicing costs, reaching $560.52 million from $112.35 million the previous year.
The rise in payments is part of a broader trend of escalating debt obligations, which are putting increasing pressure on Nigeria’s finances amid rising exchange rates.
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