Tinubu seeks Reps approval for $21.5bn external loan, N757.9bn bond

President Bola Tinubu has asked the House of Representatives to consider and approve a new external borrowing plan totalling over $21.5 billion, along with the issuance of ₦757.9 billion in domestic bonds to offset outstanding pension liabilities.

In a letter read on the floor of the House on Tuesday, Tinubu stressed the importance of the proposed 2025–2026 borrowing plan, which he said targets key sectors of the Nigerian economy.

“The 2025–2026 borrowing plan covers all sectors with specific emphasis on infrastructure, agriculture, health, education, water supply, growth, security, and employment generation, as well as financial and monetary reforms, among others,” the President wrote.

The total financing package outlined in the plan includes USD 21,543,647,912, EUR 2,193,856,324.54, and 15 billion Japanese Yen, in addition to a EUR 65 million grant.

Tinubu explained that the borrowing was necessitated by current economic realities, including the removal of the fuel subsidy and its broader fiscal impact.

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“In light of the significant infrastructure deficit in the country and the paucity of financial resources needed to address this gap amid declining domestic demand, it has become essential to pursue prudent economic borrowing to close the financial shortfall,” he wrote.

He gave assurances that the proceeds would be allocated to vital infrastructure projects, particularly in transport, healthcare, and national development programmes across all 36 states and the Federal Capital Territory.

“This initiative aims to generate employment, promote skill acquisition, foster entrepreneurship, reduce poverty, and enhance food security, as well as to improve the livelihoods of Nigerians,” he emphasised.

In a separate request, Tinubu sought legislative backing for the issuance of domestic bonds to clear pension arrears under the Contributory Pension Scheme (CPS), amounting to ₦757,983,246,572.

Citing the Pension Reform Act 2014, the President said revenue shortfalls had hampered the government’s ability to meet its statutory obligations, leading to mounting arrears and financial hardship among retirees.

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“The House of Representatives is invited to note that the federal government has not been compliant with the implementation of the above provisions of the PRA 2014 over the years due to revenue challenges leading to accumulation of pension arrears with the attendant ICU retirees,” he stated.

He added that the bond proposal had secured the approval of the Federal Executive Council at its meeting on 4 February 2025.

According to Tinubu, clearing the arrears would improve retirees’ welfare, restore trust in the pension system, and provide a liquidity boost to the economy.

“It will enable the Federal Government of Nigeria to meet obligations under the CPS and restore confidence in the pension industry. It will also ensure positive welfare even for the retirees, as this will enable them to meet their basic needs… improve health and avoid untimely death,” the letter stated.

“While I look forward to the progression and timely approval of the House of Representatives, please accept, Your Honourable Speaker, the assurances of my high regards,” he urged.