Tinubu Seeks $2.34bn Loan to Fund 2025 Budget

By Oluwakemi Kindness

President Bola Ahmed Tinubu has formally requested the approval of the House of Representatives for the Federal Government to raise $2.34 billion in external capital to fund part of the 2025 budget deficit and refinance maturing Eurobonds.

In a letter read by Speaker Tajudeen Abbas during Tuesday’s plenary, President Tinubu said the move aligns with Sections 21(1) and 27(1) of the Debt Management Office (DMO) Establishment Act, 2003, which authorizes borrowing for public financing and debt restructuring.

According to the President’s correspondence, the total external capital to be raised is $2.347 billion — comprising $1.229 billion in new borrowing under the 2025 Appropriation Act and $1.118 billion to refinance Eurobonds maturing in November 2025.

Tinubu explained that the funds would be sourced through a mix of Eurobond issuance, syndicated loans, bridge financing, and direct borrowing from international financial institutions, depending on prevailing market conditions.

He noted that the plan is part of a broader fiscal strategy to strengthen infrastructure funding, manage debt obligations, and sustain investor confidence in Nigeria’s credit market.

The President also sought approval for the issuance of Nigeria’s first-ever $500 million sovereign Sukuk, an international Islamic bond designed to diversify funding sources and attract ethical investors.

Tinubu highlighted that domestic Sukuk programmes have so far mobilized over ₦1.39 trillion since 2017, financing major road and infrastructure projects across the country.

Under the new plan, up to 25% of the proceeds will be used to refinance high-cost debts, while the remaining funds will support priority infrastructure projects. The Sukuk may also be issued with or without a credit enhancement guarantee from the Islamic Corporation for the Insurance of Investment and Export Credit (ICIEC), a member of the Islamic Development Bank Group.

The President emphasized that refinancing the $1.118 billion Eurobonds maturing in 2025 is a standard debt management approach to prevent default and maintain Nigeria’s credibility in global capital markets.

He assured lawmakers that the Federal Ministry of Finance and the DMO will work closely with transaction advisers to ensure the best market conditions before issuing the instruments.

“The proposal seeks the House’s approval for the Federal Government to raise external capital and issue the debut sovereign Sukuk accordingly,” Tinubu wrote.

In a related development, the House of Representatives hosted a delegation of Ghanaian parliamentarians on a one-week observation visit to the National Assembly, coinciding with Nigeria’s 65th Independence anniversary.

Speaker Tajudeen Abbas welcomed the delegation led by Hon. Godfrey Kini, Hon. Lorencia Zeromu, Hon. Akwasi Gyengfi Oyinna, and Mrs. Gifi, Principal Assistant Clerk of the Ghanaian Parliament, commending the visit as a step toward strengthening legislative cooperation between both nations.