President Bola Tinubu is requesting the approval of the House of Representatives to obtain over $2,847,465,000 in external loans to finance the 2025 budget deficit and infrastructure.
Tinubu’s request was contained in a letter titled: “Request for the Resolution of the National Assembly to Implement New External Borrowing in the 2025 Appropriation Act, Refinance Maturity Eurobonds and Issue Debut Sovereign SUKUK in the International Capital Market”, with Reference No: PRES/134-1/10/EB/2 dated 22nd September 2025, read on the floor by Speaker Abbas Tajudeen.
Breakdown of the proposed loan includes: new external borrowing of N1,843,669,786,987.16 (equivalent of USD1,229,113,000 at an exchange rate of USD1.00/N1,500 in the 2025 Appropriation Act) for the part-financing of the budget deficit.
To actualise this, he urged the House to “issue its Resolution allowing the Government to raise the amount through any of the following options: issuance of Eurobonds, Bridge Finance Facility from Bookrunners, loan syndication and direct borrowing from international financial institutions.”
The refinancing of maturing Eurobonds of $1,118,352,000 (7.625%), which were issued at the international capital market on 21 November 2018 with an original tenor of seven years, will mature on 21 November 2025.
According to him, “the plan is to refinance the maturity Eurobonds through issuance of Eurobonds, Bridge Finance Facility from Bookrunners, loan syndication, or direct borrowing from international financial institutions, if necessary, to avoid default.
“This is a standard practice in debt capital markets, including the ICM. The proposal is for the House of Representatives to issue its Resolution authorising the FGN to refinance the Eurobonds accordingly.”
Mr President also requested the House of Representatives’ approval to issue a stand-alone debut sovereign Sukuk of up to $500 million in the international capital market with or without credit enhancement (guarantee).
For the implementation of the new external borrowing in the 2025 Appropriation Act, he said: “The House of Representatives may wish to note that the 2025 Appropriation Act provides for N9,276,348,934,935.79 as new borrowings to part-finance the 2025 budget deficit, of which N1,843,669,786,987.16 (equivalent of about USD1,229,113,000.00 at the budget exchange rate of USD1.00/N1,500.00) is specified as new external borrowing.”
For the refinancing of maturing Eurobonds of $1.118 billion, he said: “The House of Representatives is kindly invited to issue its Resolution allowing the Government to raise the amount through any of the following options: issuance of Eurobonds, Bridge Finance Facility from Bookrunners, loan syndication and direct borrowing from international financial institutions.”
While giving the indicative terms and conditions for external capital raising of USD2.347 billion, President Tinubu said: “Based on the presentations in paragraphs 2 and 3, the aggregate amount proposed to be raised in the ICM either through issuance of Eurobonds, Bridge Finance Facility from Bookrunners, loan syndication and direct borrowing from international financial institutions, or a combination of the options for which Resolution of the House of Representatives is being sought, is USD2,347,465,000.00. Whilst exploring all the options, the plan is to focus on the issuance of Eurobonds, and we believe that Nigeria, being a regular issuer of Eurobonds in the ICM, could raise the proposed amount, subject to market conditions.
“The House of Representatives may wish to note that because Eurobond issuance is a market-based transaction, the terms and conditions can only be determined at the time of the transactions, and they will be subject to prevailing market conditions.
“The Federal Ministry of Finance (FMF) and the Debt Management Office (DMO) will work with the transaction advisers to secure the most favourable terms and conditions. The indicative terms and conditions for issuance of USD2.347 billion Eurobonds in the ICM are attached as Annexure 1.
“Meanwhile, it is expected that the pricing of the new Eurobonds will reflect the yields on Nigeria’s Eurobonds trading in the ICM at the time of issuance, while tenors will be guided by investors’ preferences, price, and the DMO’s liability management strategy.”
On the issuance of a stand-alone USD500 million debut sovereign Sukuk, he tasked the House to “issue its Resolution authorising the issuance of a stand-alone debut sovereign Sukuk of up to USD500 million in the ICM based on the following reasons, amongst others:
“The FGN has recorded considerable success in the issuance of Sukuk in the domestic capital market for the development of critical infrastructure projects across the country. Between September 2017 and May 2025, the DMO has raised N1,392.557 trillion through Sukuk in the domestic capital market to fund critical road infrastructure projects. There is the need to pool resources from external sources to complement domestic issuance to help bridge infrastructure funding gaps; and,
“It is imperative to open new sources of funding for the FGN, and thereby diversify the investor base, as well as deepen the FGN securities market.
“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 indicative term sheet provided by ICIEC in respect of the credit enhancement is attached as Annexure II.
“The policy premium for the guarantee proposed by ICIEC is 3.5% of issue amount per annum. If the credit enhancement from ICIEC is taken for the proposed Sukuk issuance, 25% of the issue proceeds may be used to repay relatively more expensive debt obligations of the FGN, and the balance will be used to finance the development of pre-identified infrastructure projects.
“Based on the foregoing, I respectfully request the House of Representatives to pass a Resolution:
To raise external capital in the sum of USD2,347,465,000.00, comprising new external borrowing in the 2025 Appropriation Act (USD1,229,113,000.00) and refinancing of maturing Eurobonds (USD1,118,352,000.00), through any of the following option(s): issuance of Eurobonds, Bridge Finance Facility from Bookrunners, loan syndication and direct borrowing from international financial institutions.
“To issue a debut stand-alone sovereign Sukuk of up to USD500 million, with or without credit enhancement from the Islamic Corporation for the Insurance of Investment and Export Credit.”
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