The Nigerian Senate has commenced consideration of President Bola Tinubu’s request for approval to secure an external loan of $7.7bn, equivalent to N10.79tn, to finance part of the 2026 national budget deficit.
The request was conveyed in a letter dated October 26, 2026, and read by the Senate President, Godswill Akpabio, during Wednesday’s plenary.
Following the presentation, Akpabio referred the proposal to the Senate Committee on Local and Foreign Debts for detailed examination and directed the committee to report back as soon as practicable.
In the letter, Tinubu explained that the proposed borrowing formed part of the N29.2tn new borrowing provision contained in the 2026 Appropriation Act to finance the country’s estimated N31.4tn budget deficit.
The borrowing arrangement comprises N18.4tn in domestic loans and N10.79tn in external financing.
The President said the proposed foreign loan would be sourced through different financing options, including Eurobond issuance, concessional and commercial loans from multilateral and bilateral institutions, International Monetary Fund facilities, bridge financing and direct borrowing from international financial institutions.
He explained that the government would pursue the available options simultaneously, taking into consideration their respective costs, benefits and the time required to access the funds.
However, Tinubu indicated that greater emphasis would be placed on Eurobond issuance because of its relatively faster processing time and capacity to generate substantial funds at competitive costs.
He added that the final interest rates, repayment periods and other borrowing conditions would depend on prevailing market conditions when the financing arrangements were concluded.
According to the President, the Federal Ministry of Finance and the Debt Management Office would work together to secure favourable borrowing terms for the country.
Tinubu identified defence and security, transportation, agriculture, power, education and healthcare as priority sectors expected to benefit from the proposed financing.
He also noted that the foreign currency proceeds would be received by the Central Bank of Nigeria on behalf of the Federal Government, potentially strengthening the country’s external reserves.
The President maintained that the additional financing would support the implementation of critical projects and programmes contained in the 2026 budget.
Meanwhile, the latest request effectively replaces an earlier borrowing proposal seeking approval for $20.52bn and €1.045bn in external financing.
Akpabio said the new communication was more explicit about the government’s borrowing requirements and provided flexibility in sourcing funds from different international markets and financial institutions.
The proposal has also attracted criticism from former Vice-President Atiku Abubakar, who urged the Senate to reject the request, questioning the country’s increasing dependence on foreign borrowing.
Atiku called for greater transparency regarding the projects to be financed, their individual costs, interest rates and repayment conditions.
The proposed loan comes amid continuing concerns over Nigeria’s rising public debt, debt-servicing obligations and the Federal Government’s reliance on borrowing to finance budget deficits.
The Senate committee is expected to examine the proposed financing arrangements before the chamber takes a final decision on the request.
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