PRESIDENT Bola Tinubu is seeking the National Assembly’s approval for a fresh N1.767 trillion as a new external borrowing plan in the 2024 Appropriation Act.
The President’s letter containing the request notes that the loan would be used to part-finance the budget deficit of N9.7 trillion.
The President’s request was read by Speaker of the House of Representatives, Tajudeen Abbas, during plenary on Tuesday, November 19.
The President has also forwarded the MTEF/ FSP (Medium-term Expenditure Framework and Fiscal Strategy Paper 2025- 2027) and the National Social Investment Programme establishment amendment bill to the National Assembly, to make the social register the primary tool for the implementation of the Federal Government’s social welfare programmes.
The loan request has raised further questions as the Central Bank of Nigeria (CBN) recently said the Federal Government spent $3.58 billion servicing the country’s foreign debt in the first nine months of 2024.
Data sourced from the (CBN) report on international payment statistics showed that the amount represents a 39.77 per cent increase from the $2.56 billion spent during the same period in 2023.
According to the report, while the highest monthly debt servicing payment in 2024 occurred in May, amounting to $854.37 million, the highest monthly expenditure in 2023 was $641.70 million, recorded in July.
The trend in international debt servicing by the CBN highlights Nigeria’s rising cost of debt obligations.
Further breakdown of international debt figures showed that in January 2024, debt servicing costs surged by 398.89 per cent, rising to $ 560.52 million from $ 112.35 million in January 2023. February, however, saw a slight decline of 1.84 per cent, with payments reducing from $288.54 million in 2023 to $283.22 million in 2024.
March recorded a 31.04 per cent drop in payments, falling to $276.17 million from $400.47 million in the same period last year. April saw a significant rise of 131.77 per cent, with $215.20 million paid in 2024 compared to $92.85m in 2023.
The highest debt servicing payment occurred in May 2024, when $ 854.37 million was spent, reflecting a 286.52 per cent increase compared to $ 221.05 million in May 2023. June, on the other hand, saw a 6.51 per cent decline, with $50.82 million paid in 2024, down from $ 54.36 million in 2023.
July 2024 recorded a 15.48 per cent reduction, with payments dropping to $542.50 million from $641.70 million in July 2023.
In August, there was another decline of 9.69 per cent, as $279.95 million was paid compared to $309.96 million in 2023. However, September 2024 saw a 17.49 per cent increase, with payments rising to $515.81 million from $439.06 million in the same month last year.
Given rising exchange rates, the data raises concerns about the growing pressure of Nigeria’s foreign debt obligations.
The ICIR reported that in November 2023, Tinubu presented N25. 7 trillion as the proposed budget for the 2024 fiscal year to the Joint National Assembly. This was his first budget presentation as President since he assumed office in May 2023.
The 2024 budget also raised dust over budget padding with the Senate suspending, Senator Abdul Ningi for three months over his allegations that the National Assembly padded the 2024 budget.
The allegation was hinged on the unclarity of some times of the budget amounting to about N3 trillion.
Also, there were allegations of some projects carried out by ministries, departments and agencies (MDAs) without descriptions and disparities in constituency allocations.
Also, a civil non-governmental organisation, BudgiT raised issues with the budget, noting that 15 MDAs were expected to carry out more than 600 capital projects which they lacked the technical capacity to execute.
Harrison Edeh is a journalist with the International Centre for Investigative Reporting, always determined to drive advocacy for good governance through holding public officials and businesses accountable.