Taiwo Oyedele, minister of finance and coordinating minister of the economy, says the federal government’s proposed $21.7 billion external borrowing plan is intended to fund investments, rather than burden the country.
Oyedele spoke on Wednesday while answering questions from State House correspondents after the federal executive council (FEC) meeting presided over by President Bola Tinubu at the Presidential Villa in Abuja.
The minister said the loans were intended to finance productive investments that would drive economic growth and improve Nigerians’ living standards.
On Tuesday, Tinubu asked the national assembly to approve the proposed external borrowing of $20.52 billion and €1.04 billion for projects and programmes across several sectors.
In the letter read by Senate President Godswill Akpabio during plenary, Tinubu said the proposed borrowing would support infrastructure, agriculture, healthcare, education, water supply, security, employment generation and financial management reforms.
He said the plan was designed to accelerate economic growth and address the country’s infrastructure funding gap.
For all breaking news and latest gist:
👉 JOIN GISTSMATE WHATSAPP CHANNELHowever, Atiku Abubakar, presidential candidate of the African Democratic Congress (ADC), urged the national assembly to withhold approval of the borrowing plan.
In a statement issued on Tuesday by Phrank Shaibu, director of strategic communication of the ADC presidential campaign council, Atiku questioned the timing and purpose of the proposed borrowing.
The former vice-president said the request vindicated his October 12 warning that Tinubu was preparing to borrow up to $20 billion for the Lagos-Calabar coastal highway.
He said Tinubu had not provided sufficient details of the projects to be funded, including their locations, costs and contractors, to enable Nigerians to scrutinise the proposed expenditure.
Atiku also expressed concern that the loans could be channelled to political campaigners and favoured contractors, citing reports that the coastal highway had been rerouted inland.
‘THIS IS INVESTMENT, NOT BORROWING’
Responding to the former vice-president’s concerns, Oyedele said the proposed financing should be assessed based on the assets to be created and their expected economic returns, rather than viewed simply as an addition to the country’s debt burden.
“This is investment, not borrowing,” he said.
The minister said the government was seeking funds for projects that would strengthen national productivity and generate long-term economic value.
He added that the government was targeting single-digit inflation by the end of 2027 or earlier.
Under the proposed borrowing plan, transportation infrastructure accounts for about $10.6 billion, covering major projects such as the Sokoto-Badagry and Lagos-Calabar highways and the Kano-Kaduna rail project.
Oyedele said the government was seeking financing from multilateral and bilateral development partners, alongside other sources, to implement the projects.
He disclosed that approximately $7.9 billion was expected from multilateral and bilateral partners, including the World Bank.
According to him, a $5 billion World Bank component would attract concessional financing at an average interest rate of about 2.1 percent, while some loans for social sector would carry rates of around two percent.
The minister said the government was prioritising favourable financing terms to reduce borrowing costs and ensure that the projects delivered lasting economic benefits.
WARNING: If You Are Not 18+, Don’t Click The Link Below 👇🫣
https://nya5.com/link?z=11857196&var=
Did you want to monetize your website, join MONETAG or ADSKEEPER and start earning
Please don’t forget to “Allow the notification” so you will be the first to get our gist when we publish it.
Drop your comment in the section below, and don’t forget to share the post.
Never Miss A Single News Or Gist, Kindly Join Us On WhatsApp Channel:
https://whatsapp.com/channel/0029Vad8g81Eawdsio6INn3B
Telegram Channel:
https://t.me/gistsmateNG