A request Tuesday by President Bola Ahmed Tinubu to the National Assembly seeking over $6 billion foreign loans will push Nigeria’s debt stock to over N195 trillion, Daily Trust reports.

This is just as the International Monetary Fund (IMF) expressed concerns over high debt vulnerabilities among low income countries.

The president, in two separate letters addressed to the Senate President, Godswill Akpabio and the House of Representatives Speaker, Abbas Tajudeen, said the new foreign loans would be used to fund infrastructure, debt repayment and ports rehabilitation.

Daily Trust reports that the two letters requesting the loans were first read and approved by both chambers of the National Assembly during the Tuesday plenary.

In a letter read during the plenary, the president sought a $5 billion loan from the First Abu Dhabi Bank in the United Arab Emirates (UAE).

According to the letter, the request, if granted, would increase the country’s debt stock from $110.3 billion to $115.3 billion.

While urging the National Assembly for “urgent approval,” the president noted that the collateral for the loan would include Naira-denominated securities.

In another separate letter to the National Assembly, the president sought another $1 billion for the rehabilitation of Lagos Port Complex and Tin Can Island Port.

He said the facility is arranged by Citibank London and covered by UK Export Finance (UKEF) primarily to modenise the two Lagos ports to improve functionality, safety and efficiency.

In the letter addressed to the Senate President and the Speaker of the House and read during the plenary, the president said the rehabilitation work on the two ports would address decades-old deficiencies, enhance safety and global best practices as well as support the country’s economy growth.

The president said the loan, if approved, would have a repayment tenure of 14 years including 48-month additional availability period.

He added that the loan term was 1.1 percent availability fee and 1.07 percent UKEF premium.

Earlier, the chairman of the Senate Committee on Foreign and Local loans, Senator Wamakko Magatarkada Aliyu (Sokoto North), said his committee deliberated extensively on the proposed loans before submitting its report to the plenary for approval.

As of September 30, 2025, Nigeria’s total public debt increased to N153.29 trillion ($103.94 billion), driven by rising domestic and external obligations.

According to a data from the Debt Management Office (DMO), this reflects an increase from N152.40 trillion in June 2025, with the debt consisting of N81.82tn domestic and $48.46bn external debt.

While the final 2025 debt report is yet to be released, it was projected that the debt profile would have ballooned to over N189 trillion.

The latest borrowing, if converted to Naira, would amount to N8.3 trillion at the prevailing exchange rate.

It would be recalled that the Central Bank of Nigeria (CBN) had projected a debt-to-GDP ratio of 34 per cent; while foreign reserves are expected to rise to $51 billion in its 2026 macroeconomic outlook report.

“Public debt as a percentage of GDP is projected at 34.68 per cent by end-2026, compared with 33.98 per cent as at June 2025, predicated on expected new borrowings,” the report added.

Daily Trust reports that the debt-to-GDP ratio compares a country’s total government debt to its Gross Domestic Product (GDP), showing its ability to pay debts relative to its economic output.

The Northern Elders Forum (NEF) had recently called on Nigerians to speak out against what it described as “reckless and unsustainable” borrowing by the federal government, warning that the country’s economic future is being dangerously mortgaged.

In an open letter addressed to Nigerians, the elders said silence in the face of mounting public debt amounted to complicity, stressing that the nation was no longer dealing with routine fiscal decisions but a pattern of borrowing marked by weak accountability and democratic neglect.

Signed by the NEF spokesperson, Professor Abubakar Jika Jiddere, the group expressed concern over the federal government’s reported move to secure an additional N17.89trn loan to fund the 2026 budget.

IMF raises concern over debt vulnerabilities

The International Monetary Fund (IMF), in a report released yesterday titled ‘Macroeconomic Developments and Prospects in Low-Income Countries—2026’ said the significant increase in domestic borrowing was raising new concerns.

The IMF specifically expressed concerns over high debt vulnerabilities among Low-Income Countries (LICs).

The report was the outcome of the discussion of the Executive Board of the International Monetary Fund (IMF) on Macroeconomic Developments and Prospects in Low-income Countries (LICs).

The paper defines LICs as the 70 countries eligible for the Poverty Reduction and Growth Trust facilities.

The report said, “LICs are navigating a fluid global environment marked by high uncertainty and shifting policies in major economies spanning trade, migration, digital finance, and spending priorities, including national security and foreign aid. The spillovers of the ongoing conflict in the Middle East adds to the pressures, although the actual impact will depend on the duration of the conflict and breadth of disruptions.

“While internal and external imbalances have been narrowing in recent years, macroeconomic outcomes remain highly divergent across LICs. GDP growth averaged 4.8 percent in 2025, but remained highly heterogenous across LICs. Some LICs are among the world’s fastest growing economies, while others grow insufficiently to boost per capita income. Inflation continues to ease but hotspots remain.

“Fiscal consolidation has supported modest reductions in public debt, yet debt vulnerabilities remain high, and the significant increase in domestic borrowing is raising new concerns. Many LICs with thin foreign exchange reserves remain vulnerable to changes in commodity prices, global interest rates, and further aid cuts. Divergence across LICs is expected to persist over the medium term amid elevated global and domestic risks.

“External financing to LICs is undergoing major shifts. After peaking during 2010-14, net financial inflows to LICs have fallen by about one third amid declines in FDI equity flows and external debt. New public sector borrowing from the private sector has been contracted at higher interest rates and shorter maturities, while official creditors have adjusted terms more gradually, preserving grant elements for the poorest LICs.”

N/Assembly passes N68.3tn 2026 budget

The National Assembly yesterday passed N68.3 trillion as aggregate budget profile for 2026 fiscal year, an amount which is N9 trillion above the N58.472 trillion earlier proposed by President Bola Ahmed Tinubu in December last year.

The N9 trillion increase in the approved budget arose from adjustments made to the earlier proposal by President Tinubu.

Our correspondents report that the passage of the N68.3 trillion 2026 budget by both chambers followed harmonised reports submitted to that effect by their Committees on Appropriation.

According to the report presented in the Senate by the chairman of Appropriation Committee, Senator Olamilekan Adeola (Ogun West) and his counterpart in the House of Representatives, Abubakar Bichi, the adjustments affected in the budget are “the outstanding unfunded capital obligations amounting to N5.71 trillion arising from the 2025 Appropriation (Repeal and Enactment) Act, as well as N2 trillion capital for priority projects across multiple sectors and locations nationwide, which were omitted in the rollover to the 2026 Appropriation Bill.

“Federal Government equity contribution of N478.60 billion under the Ministry of Finance Incorporated (MOFI) framework for the Presidential Legacy Light Rail Projects in Lagos, Kano, Kaduna, and Ogun States, including feasibility studies for the Enugu and Maiduguri Urban Light Rail Projects, as well as the narrow-gauge railway network;

“The provision of N8.96 billion for detailed feasibility studies for the Calabar–Maiduguri Corridor (traversing the North Central Zone) and the Maiduguri–Sokoto Superhighway under the Tinubu National Beltway Initiative.

“An additional US$344.83 million, equivalent to approximately N482.76 billion, for priority health sector interventions tied to existing bilateral understandings and implementation commitments and a further provision of N98.50 billion for the Court of Appeal and N36.7 billion for the Supreme Court in support of the institutional architecture for the 2027 General Election cycle; and N268.54 billion for the reinstatement of the Judiciary’s budget ceiling, as well as additional provisions to accommodate the prospective appointment of more Justices of the Court of Appeal and Judges.”

According to Senator Adeola, the N68.3 trillion budget has N4.79 trillion as Statutory Transfer, N15.4 trillion as recurrent expenditure, N32.2 trillion as capital expenditure and N15.8trillion for debt servicing.

He said aside oil price bench mark of $65 moved to $75, other parameters the budgetary proposals were predicated upon, are retained as proposed and as contained in the 2026 – 2028 Expenditure Framework and Fiscal Strategy Paper.

The committee’s report recommended “That bureaucratic bottleneck that led to the challenges of late releases of funds in 2025 should be addressed holistically, to achieve the Theme of the 2026 Appropriations Bill “From Budget to Impact”.

“Deliberate efforts must be made in 2026 by the Senate in collaboration with the Executive to implement 2026 Appropriation holistically.

“The 2026 budget implementation should be monitored by the various committees, with a purpose to manage and guide capital projects implementation with discipline, and pursue infrastructural growth that is broad based with sustainable legislation”.

In his remarks after passing the budget, Senate President Godswill Akpabio said the budget, if well implemented, would further take Nigeria out of the woods.

2025 budget spending extended to June 30

At the plenary yesterday, both chambers of the National Assembly approved a bill to amend the 2025 Appropriation Act to further extend the implementation of the capital components of the Act from March 31 to June 30.

This followed a request by President Tinubu, seeking a three-month extension to give room for further implementation of the capital budget by MDAs.

The bill, which was first presented yesterday by the leader of the Senate, Senator Bamidele Micheal Opeyemi, (APC Ekiti Centra), was immediately passed by the plenary presided over by the Senate President, Godswill Akpabio.

According to Senator Bamidele, the request for the extension was because less than 30 percent of the 2025 budget was released due to the paucity of funds, adding that the extension of the budget is also to check the risk of abandoned projects.

In the House of Representatives, the same bill was considered and passed following its presentation by the House Leader, Prof Julius Ihonvbere.

Ihonvbere, while reading the synopsis of the bill, said, the move was to ensure that ongoing capital projects by MDAs under the 2025 budget cycle are not abandoned.

Meanwhile, some analysts have noted that the extension of the 2025 budget when the 2026 budget had already been passed shows that the present administration is still running a multiple budget regime contrary to a pledge by President Tinubu to stop such practice with effect from March 31, 2026.

Tinubu, on December 19, 2025, while presenting the N58.18 trillion 2026 budget to the joint session of the National Assembly, said all multiple budget implementations would end in March 2026, and that from April, Nigeria would operate on a single budget, backed by a single revenue cycle.

The president said, “This is research, a very hard one. Avoiding abandoned projects, unpaid contractual obligations and running multiple budgets, both inherited and of fulfilled mandates, is a problem staring the nation.

“So we are terminating the habit of running through a budget on one inflow.

“By March 31, 2026, all capital liabilities from previous years will be fully funded and closed. Since April, Nigeria has operated on a single budget, backed by a single revenue cycle.

“No overlaps, no excuses and no rollover cultures,” he said.

He said that the budget presented a defining moment in the nation’s journey of reform and transformation.

The Tinubu administration has come under criticisms from financial experts over lack of fiscal discipline which has led to poor capital releases and rolling over of budgets. There has also been criticisms over delay in the passage and implementation of the budgets under this administration unlike in the past where budgets operated from January through December. Under the current government there is no clear timeline for budget approval and implementation.

‘Borrowing without scrutiny detrimental to economy’

The Centre for Fiscal Transparency and Public Integrity (CEPTI) has raised concerns over the approval of a $6 billion external loan, warning that borrowing without adequate scrutiny could be detrimental to Nigeria’s economy.

The organisation said the speed at which the loan was approved leaves little room for transparency, public scrutiny and robust legislative oversight, stressing that borrowing of such magnitude requires careful review.

The Executive Director of CEPTI, Dr Umar Yakubu, noted that the development reflects Nigeria’s growing reliance on external debt, particularly for budget support rather than clearly defined, revenue-generating investments.

“The Center for Fiscal Transparency and Public Integrity considers the approval of the $6 billion external loan problematic primarily because of the speed at which it was granted, leaving little room for transparency, public scrutiny, or robust legislative oversight. Borrowing of this scale requires careful review, which was largely absent in this case.

“The loan also highlights Nigeria’s growing reliance on external debt, particularly for budget support rather than clearly defined, revenue generating investments. This increases exposure to exchange rate risks and future debt service pressures. Concerns are heightened by the use of complex financing structures that may obscure long term costs if not full disclosed.

“Equally important are the transparency gaps surrounding the borrowing. Key details on loan terms, repayment obligations, and debt sustainability impacts were not publicly available, limiting citizens’ ability to assess whether the loan serves the public interest. There is also a risk that weak governance could undermine the effectiveness of the infrastructure component.

“The Center, therefore, urges full disclosure of all loan agreements, a clear assessment of debt implications by the Debt Management Office, stronger legislative oversight, and transparent, audited management of infrastructure funds. Borrowing should support—not replace—fiscal reform, or it risks deepening Nigeria’s long term economic burden”, he said. (Daily Trust)

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