President Bola Tinubu has asked the house of representatives to approve a plan to borrow $2.35 billion in external capital to finance part of the 2025 budget deficit and refinance Nigeria’s maturing eurobonds.
The president also sought approval to issue a $500 million debut sovereign sukuk in the international capital market (ICM) to fund infrastructure projects and diversify Nigeria’s sources of financing.
Tinubu’s request was contained in a letter addressed to Tajudeen Abbas, speaker of the house of representatives, and read on the floor of the green chamber on Tuesday.
According to the letter, the external borrowing is backed by provisions of Sections 21(1) and 27(1) of the Debt Management Office (Establishment) Act, 2003, which require legislative approval for new loans and refinancing arrangements.
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The president said the borrowing plan includes $1.23 billion (N1.84 trillion) provided for in the 2025 Appropriation Act to part-finance the budget deficit, and another $1.12 billion to refinance a eurobond maturing on November 21.
“The plan is to refinance the maturing Eurobonds through the issuance of Eurobonds, bridge finance from bookrunners, loan syndication, or direct borrowing from international financial institutions to avoid default,” the letter reads.
‘FUNDS TO BE RAISED THROUGH FINANCING FACILITIES, LOAN SYNDICATIONS’
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Tinubu said the funds would be raised through one or a combination of instruments such as eurobonds, loan syndications, or bridge financing facilities, depending on prevailing market conditions.
He added that the federal government expects the pricing of the new eurobonds to align with current yields on Nigeria’s existing bonds in the international market, ranging between 6.8 percent and 9.3 percent, depending on maturity.
On the proposed $500 million sovereign sukuk, Tinubu said the move would help diversify Nigeria’s investor base and deepen the government securities market.
He added that proceeds will support the development of critical infrastructure projects across the country.
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According to the president, the federal government had successfully borrowed over N1.39 trillion through domestic sukuk issuances between 2017 and 2025 for key road and infrastructure projects, and the external sukuk would complement domestic efforts.
“It is imperative to open new sources of funding for the federal government and to deepen the FGN securities market,” Tinubu said.
“The proposal is for the house of representatives to approve the issuance of a stand-alone debut Sovereign Sukuk with or without credit enhancement (Guarantee) from the Islamic Corporation for the Insurance of Investment and Export Credit (ICIEC), a member of the Islamic Development Bank (IsDB) Group.”
The president said 25 percent of proceeds from the sukuk may be used to repay high-cost existing debt, while the balance would be channelled into infrastructure financing.
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Tinubu urged the house to grant timely approval to enable the government to proceed with the borrowing and refinancing plan, assuring lawmakers of his administration’s commitment to fiscal discipline and transparent debt management.
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