Senate declines Buhari’s request to borrow $30b

The Nigerian Senate Tuesday declined to sanction President Muhammadu Buhari’s request to borrow about $30 billion.

The president had on October 26, 2016, forwarded the request to the National Assembly to approve external borrowing plan of $29.960 billion to execute key infrastructural projects across the country between 2016 and 2018.

He also requested for virement of N180.8 billion in the 2016 budget for provision of needed votes for some critical sectors across the 36 states of the federation and the FCT.

Buhari made the requests in two separate letters to the President of the Senate, Dr Bukola Saraki, and Speaker of the House of Representatives, Mr Yakubu Dogara, which were read on the floor of both chambers.

Senators turn down request for approval for external borrowing due to lack of documents supporting the request as referenced in the letter

— Nigerian Senate (@NGRSenate) November 1, 2016

When the question was put to commence the consideration of the request senators answered in the negative, rejecting the proposal.

The President of the Senate Bukola Saraki who appeared surprised by the position of the senators posed the question again and many more senators answered “nay”.

Saraki, therefore, ruled in favour of the dissenting voices and the request was rejected.

But the director-general of the Debt Management Office (DMO) Dr. Abraham Nwankwo said the country is need of the loan.

Speaking on a Channels TV on Tuesday, Nwankwo explained that the loan, which covers a period of three years, would help in addressing the biting infrastructure deficit in the country.

He stated, “When you are in this kind of economic situation, you have to decide where you want to start addressing the problem. You then come to the conclusion that the most critical point to start is to deal with infrastructure problem. If you deal with infrastructure problem, the cost of power will be lower, the cost of transportation will be lower, and the cost of most other services will be lower.”

A source close to the National Assembly told our correspondent that the borrowing plan is part of the 2016 to 2018 Medium Term Expenditure Framework (MTEF) and Fiscal Strategy Paper (FSP) which had not been considered nor passed.

He said that the Senate could not then approve the loan which was part of the MTEF which was yet to be considered.

The source also said that the request of President Buhari was not submitted with the attached breakdown of the proposed expenditure for which the loan was sought.

The loan is to be expended as follows: projects and programmes loan of $11.274 billion; Special National Infrastructure projects $10.686 billion; Euro Bonds of $4.5 billion and Federal Government Budget Support of $3.5 billion.