President Bola Ahmed Tinubu has formally sought the House of Representatives’ consent to secure .3 billion in fresh external loans and to refinance existing debt, alongside launching a $500 million inaugural sovereign Sukuk on the global capital markets.
This appeal was conveyed through a letter presented by Speaker Tajudeen Abbas during Tuesday’s House session. The request aligns with the provisions of Sections 21(1) and 27(1) of the Debt Management Office (DMO) Establishment Act of 2003.
According to President Tinubu, this borrowing initiative is integral to the financing strategy for the 2025 Appropriation Act. It also aims to restructure maturing Eurobonds and broaden Nigeria’s financing avenues by incorporating Islamic finance instruments.
The communication detailed that the 2025 fiscal plan anticipates $9.27 billion in new borrowings to bridge the budget deficit, with $1.84 billion (equivalent to ₦1.23 trillion at an exchange rate of ₦1,500 per dollar) earmarked for external loans.
The president requested legislative authorization for the Federal Government to mobilize these funds through various channels, including Eurobond issuances, syndicated loans, bridge financing arranged by book runners, or direct loans from international financial bodies.
He also revealed intentions to refinance Nigeria’s $1.118 billion Eurobond issued in 2018, which carries a 7.625% coupon and matures in November 2025. Tinubu emphasized that such refinancing is a common practice in global debt markets, noting that restructuring via Eurobonds or syndicated loans would enhance debt sustainability and bolster investor trust.
Emphasizing the government’s notable achievements in domestic Sukuk issuances-having raised ₦1.39 trillion since 2017 to fund vital infrastructure-Tinubu stated that the proposed international Sukuk would further infrastructure development and attract a wider investor base.
He explained that if the ICIEC credit guarantee is activated, 25% of the proceeds will be allocated to repaying higher-cost debt, with the remainder directed toward pre-selected infrastructure projects.
President Tinubu assured the House that the Federal Ministry of Finance and the Debt Management Office will work closely with financial advisors to secure the most advantageous terms and pricing for all capital-raising efforts, considering current market dynamics.
