By Gift ChapiOdekina, Nnasom David, Abuja
President Bola Ahmed Tinubu has requested the approval of the House of Representatives for new external borrowing and debt refinancing totalling $2.3 billion, alongside the issuance of a $500 million debut sovereign Sukuk in the international capital market.
The request, contained in a letter read on the floor of the House by Speaker Tajudeen Abbas, seeks the National Assembly’s resolution in line with Sections 21(1) and 27(1) of the Debt Management Office (DMO) Establishment Act, 2003.
According to the President, the new borrowing is aimed at implementing provisions of the 2025 Appropriation Act, refinancing maturing Eurobonds, and diversifying Nigeria’s funding sources through Islamic finance instruments.
President Tinubu explained that the 2025 budget provides for $9.27 billion in total new borrowings to finance the year’s fiscal deficit, out of which $1.84 billion (₦1.23 trillion at an exchange rate of ₦1,500/$) is earmarked for external loans.
He urged the lawmakers to authorise the Federal Government to source the funds through any of the following options:
Issuance of Eurobonds; Loan syndication; Bridge financing from bookrunners; or Direct borrowing from international financial institutions.
The President also disclosed that Nigeria’s $1.118 billion Eurobond, issued in 2018 at 7.625% and maturing in November 2025, will be refinanced to avoid default.
“This is a standard practice in debt capital markets,” the letter noted, adding that refinancing through Eurobonds or syndicated loans would ensure debt sustainability and investor confidence.
In a significant move to expand Nigeria’s access to Islamic finance, President Tinubu also sought approval to issue a standalone sovereign Sukuk of up to $500 million in the international market — 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.
He explained that the decision was inspired by the government’s “considerable success” in domestic Sukuk issuances, which have raised ₦1.39 trillion since 2017 for critical infrastructure, particularly road projects.
According to the President, the proposed international Sukuk will help bridge the country’s infrastructure funding gap and deepen its investor base.
“If the ICIEC credit guarantee is utilised, 25% of the proceeds will be used to repay relatively expensive debt obligations, while the balance will finance pre-identified infrastructure projects,” the letter stated.
Tinubu assured the House that the Federal Ministry of Finance and the DMO would work closely with transaction advisers to secure the most favourable terms and pricing for all capital-raising efforts, subject to prevailing market conditions.
“Nigeria remains a regular and reputable issuer in the international capital markets,” he said, expressing confidence that the country could successfully raise the proposed amounts.
The President concluded his correspondence by urging the House of Representatives to pass a resolution authorising the Federal Government to:
Raise $2.347 billion through Eurobonds, syndicated loans, or bridge financing;
Refinance the maturing $1.118 billion Eurobond due November 2025; and
Issue a $500 million sovereign Sukuk with potential ICIEC credit enhancement.
“I look forward to the timely issuance of the House’s resolution,” the President stated, reaffirming his commitment to prudent fiscal management and sustainable debt practices.
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