Confusion in Nigeria over Buhari’s N850 billion loan request seen as “fresh loan” but described by senate as “amended loan”

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The Nigerian Senate had approved President Muhammadu Buhari’s request to borrow N850 billion externally. But after the IMF approved $3.4 billion loan or N1.3 trillion loan for Nigeria, the senate amended the former request to say the N850 billion would now be sourced internally.

The amendment was interpreted as a new loan and the senate provided a bizarre explanation.

Read the full statement by the Nigerian senate

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The Senate has denied alleged report suggesting that the upper chamber on Tuesday gave a fresh approval for a loan request by President Muhammadu Buhari to the tune of N850 billion. 

A statement issued by the Senate spokesman, Senator Ajibola Basiru, described the report by some national dailies as “erroneous” and not a true representation of what transpired on the floor during plenary. 

According to the lawmaker, the upper chamber on Tuesday only amended a resolution reached earlier as to where the initial N850 billion already approved by the National Assembly would be sourced. 

Recall that the Senate had initially approved sourcing of the loan from external borrowing. 

The upper chamber, according to him, rescinded on the earlier decision to seek external borrowing by resolving to obtain the loan through the Domestic Capital Market. 

“It is very important to make a very important clarification particularly on the widely circulated erroneous report that the Senate approved a fresh loan of N850 billion at the Plenary on Tuesday. 

“That is far from the truth. The resolution passed was an amendment of the earlier resolution as to the source of the initial N850bn loan that had been approved to be part of what should be used to fund the 2020 Appropriation Act. 

“You will recall that the Senate had actually approved the loan of N850 billion but to be sourced from external sources. 

“However, because of the covid-19 Pandemic and of the challenge in the international oil market with the attendant challenges of raising the approved loan externally, the President requested that the approved loan should rather be raised through the Domestic Capital Market.

“It was the above request as to sourcing the earlier approved external borrowing of N850bn from Domestic Capital Market that was approved by the Senate”, Senator Basiru explained.

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Simon Ateba
Simon Ateba
Simon Ateba covers the White House, the U.S. government, the International Monetary Fund, the World Bank and other financial and international institutions for Today News Africa in Washington D.C. Simon can be reached on simonateba@todaynewsafrica.com

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