The Senate Tuesday approved the $5 .513billion external loan request forwarded to it by President Muhamnadu Buhari last week.
President Buhari had in the request read on the floor of the Senate last week Thursday by the Senate President , Ahmad Lawan, said it became imperative for funding the revised N10.509 trillion 2020 budget and insulating the Nation’s economy from the yet to be abated COVID-19 pandemic .
The Senate accordingly mandated its committee on local and foreign loans to work expeditiously.
However, the Senator Clifford Ordia-led committee in its reports adopted by the Senate, recommended approval for the $5.513billion single line borrowing for funding of the 2020 budget and stay of action on other ones totalling $1.5billion for states , pending when details on it would be be provided by the executive.
The committee in the report states: “Notes that the Appropriation Act (Amendment) Bill 2020 contains a revised total budget of N10.594 trillion with a deficit of N4.563 trillion which will be part financed by proposed Domestic Borrowing of N2.188 trillion and External Borrowing of N1,984 trillion.
“That the first component of the request of Mr. President is to seek the approval of the Senate to embark on the External borrowing of the sum of $5,513,000,000 to ensure the financing of the revised 2020 budget deficit. “That the budget deficit request of Mr. President is aimed at bridging the revenue shortfalls for the 2020 fiscal year and to access immediate funds required to deal expeditiously and decisively with the ravaging impact of the COVID-19 Pandemic. “Observed that this approval will immediately provide the much needed liquidity in order to Finance deficit that will be approved in the revised Appropriation (Amendment) Act of 2020 and enable Government to implement and pursue some key priority activities toward curtailment of the COVID-19 Pandemic. “In view of the above, the Committee, based on clarification and information provided by the Minister of Finance, Budget and National Planning, decided to accelerate the consideration for approval, the sum of $5,513,000,000, being first component of the request in respect of the funding of the Budget deficit proposed for 2020 fiscal year. “In agreement with the attending MDA’s, concluded that, in the present circumstances of absence of required details, it will resume and conclude the consideration of the other two outstanding components of Mr. President’s External Borrowing request relating to Funding of Priority Projects of the Federal Government to be captured in the Budget estimates for 2021 and Facilities to support States Government to face the challenges of the COVID-19 Pandemic.”
The committee added that the sources for the loans are the International Monetary Fund ( IMF) $3.4bn, World Bank $1.4bn, Africa Development Bank $500million , Islamic Development Bank $113m etc .