Nigeria’s upper legislative chamber, the Senate, has approved a $5.5 billion external loan request by President Muhammadu Buhari.
The president had in a letter on October 10, this year, requested the Senate to approve $3 billion external loan and $2.5 billion Eurobond or Diaspora bond in the international market. President Buhari explained that the bonds would be channeled towards funding the 2017 budget while the loan would be used in refinancing maturing domestic debts.
Based on the Senate’s resolution, the Committee on Local and Foreign Debts on October 19 invited the Minister of Transportation, Rotimi Amaechi, and some other members of the executive to explain the benefits of the loan.
Mr. Amaechi, who had earned unpopularity for himself after serving as the PDP Governor of oil-rich Rivers state before switching over to the APC, told the lawmakers that the loan would enable the central government to complete its ambitious rail projects across the country.
Presenting the report of the committee, Shehu Sani, of the ruling APC representing Kaduna state, said the projects listed for the loan would stimulate economic development and create direct and indirect jobs for Nigerians. He explained that the $2.5 billion will create more borrowing space for the private sector.
But many Nigerians are not easily convinced. The track record of past central governments in Nigeria does not give much to write home about, in terms of foreign loans. They feel that the government of the day merely piles up loans for its successor to brood over while there is nothing on ground to show that the loans were utilized for the benefit of the people.
It will be recalled that in 2005 the government of President Olusegun Obasanjo brooded over the huge debt hang-over that the nation had incurred and fought doggedly to obtain debt relief for Nigeria.
