The House of Representatives has approved President Bola Tinubu’s request to borrow $2.35 billion to finance part of Nigeria’s 2025 budget deficit.
The green chamber also granted approval for the issuance of a $500 million debut sovereign sukuk in the international capital market to fund key infrastructure projects and diversify the country’s sources of financing.
The approvals followed the consideration of a report by the House Committee on Aids, Loans, and Debt Management during Thursday’s plenary session.
According to the report, lawmakers endorsed the implementation of a new external borrowing of ₦1.84 trillion (equivalent to $1.23 billion) at the budget exchange rate of ₦1,500/$1 to partly finance the ₦9.27 trillion budget deficit outlined in the 2025 Appropriation Act.
Earlier this month, President Tinubu had written to the National Assembly seeking legislative backing for the loan request, citing Sections 21(1) and 27(1) of the Debt Management Office (Establishment) Act, 2003, which mandate parliamentary approval for new loans and refinancing arrangements.
The President explained that the funds would be raised through one or a mix of financial instruments such as Eurobonds, loan syndications, or bridge financing, depending on prevailing market conditions.
Tinubu noted that the pricing of the proposed Eurobonds would align with current yields on Nigeria’s existing international bonds, which range between 6.8% and 9.3%, depending on maturity.
On the proposed $500 million sovereign sukuk, Tinubu said the issuance would expand Nigeria’s investor base, deepen the domestic securities market, and support the development of critical infrastructure nationwide.
“It is imperative to open new sources of funding for the federal government and deepen the FGN securities market,” the President said.
He added that 25% of the sukuk proceeds might be used to repay high-cost existing debt, while the remaining 75% would be channelled into infrastructure financing.
Since 2017, the federal government has raised over ₦1.39 trillion through domestic sukuk issuances for key road and infrastructure projects. The new external sukuk is expected to complement those domestic efforts.
The House approval marks a significant step toward implementing the external financing component of the 2025 budget and forms part of Tinubu’s broader fiscal strategy to boost foreign reserves, stabilise the naira, and fund critical infrastructure amid growing debt obligations.
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