The federal ministry of finance has clarified that President Bola Tinubu’s recent $21.5 billion external borrowing request does not translate to an automatic increase in Nigeria’s debt profile.
On May 27, President Tinubu wrote to the National Assembly seeking approval for a borrowing plan totalling $21.5 billion, alongside a request to issue federal government bonds worth N757.9 billion to offset outstanding pension liabilities under the contributory pension scheme (CPS).
In a statement on Tuesday, May 27, Mohammed Manga, director of information and public relations at the ministry, said the proposal is part of a broader debt rolling plan designed to bring structure and strategic foresight to Nigeria’s borrowing approach. He said the initiative replaces previous reactive borrowing methods and aims to ensure fiscal sustainability.
“The Debt Rolling Plan is not an automatic green light for increasing the debt burden. It is a strategic framework that guides sustainable and purposeful borrowing,” the statement read.
The ministry emphasized that the bulk of the proposed borrowing will come from development partners such as the World Bank, African Development Bank, China EximBank, Japan International Cooperation Agency (JICA), the French Development Agency, European Investment Bank, and the Islamic Development Bank. These institutions offer concessional financing with favorable terms and extended repayment periods.
According to the ministry, the borrowed funds are earmarked for investments in critical sectors, including infrastructure, transportation, energy, and agriculture, areas identified as key to achieving inclusive and sustained economic growth.
“Our borrowing strategy is guided not by the volume of loans but by their utility, sustainability, and the economic value they generate. Each facility will be strictly tied to growth-enhancing projects,” the ministry said.
The statement also reiterated the government’s commitment to maintaining debt within sustainable limits. It pointed to ongoing tax reforms and efforts to improve domestic revenue generation as key components of the strategy to bolster financial stability.
“We are committed to fiscal discipline, transparency, and accountability. Legislative oversight and public engagement are key to building long-term economic stability and inclusive national prosperity,” the ministry added.
Manga also highlighted that the administration’s tax reform agenda and revenue enhancement measures are expected to significantly improve financial management and reduce reliance on external borrowing over time.
