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President Buhari seeks senate approval for N10.7 trillion loan rejected by 8th Senate



President Muhammadu Buhari has asked the 9th Senate to approve the sum of $22.72 billion loan, after making a similar request three years ago to the 8th assembly, which was eventually rejected.

In the letter dated Nov. 26, President Buhari said the senate failed to approve a $30 billion external borrowing plan in its entirety. Rather, a $4.5 billion Eurobond sale was approved alongside five projects out of a total of 39.

The president asked also asked the Federal House of Representatives to reconsider and approve the external borrowing plan for 2016-2018 as well as projects tied to the funds, he said in the letter.

The government has said it wanted to borrow more from abroad so that 40% of its loans come from offshore sources by 2019 to lower cost and help fund its record budgets. Buhari plans to spend 10.33 trillion naira ($33.8 billion) next year, a 17% increase over this year’s budget.

The Debt Management Office (DMO) said it had no plans to use the international debt market in 2019 after its sixth Eurobond sale a year earlier. However, the debt office has said the government plans to tap cheap concessionary loans this year.

The new borrowings are tied to projects supported by the World Bank, African Development Bank, Islamic Development Bank, German Development Bank and China EXIMBank, the letter read.

“Outstanding projects in the plan that were not approved by the legislature are … critical to the delivery of the government’s policies and programmes relating to power, mining, roads, agriculture, health, water and educational sectors,” Buhari said in the letter.

Recall that in 2016, Buhari had asked the Senate led by Senator Bukola Saraki to approve $30 billion load to enable his administration finance major projects. But the Senate rejecting the plan.