Tinubu Writes Reps For Approval Of N10.8trn External Loan Implementation

President Bola Tinubu has written to members of the House of Representatives, requesting approval for the implementation of new external borrowing contained in the 2026 Appropriations Act to the tune of about N10.8 trillion.

The borrowings, according to the President, are to implement the projects contained in the Appropriations Act to strengthen the macro gains made so far.

Tinubu had recently been under fire for increasing external borrowings, which critics said were capable of drowning the economy rather than rescuing it from the clutches of debts.

In response, Tinubu defended his administration’s plan to take more foreign loans, saying Nigeria needed long-term investment in infrastructure to achieve its ambition of becoming a $1 trillion economy by 2030.

His defense comes as the Nigeria Labour Congress (NLC) questions the government’s request to the National Assembly for approval to borrow $20.5 billion and €1.45 billion, despite claims that government revenue has increased following the removal of petrol subsidy.

In a statement titled From Reforms to Delivery: Our Infrastructure Investment and Growth Strategy, the President said the focus should be on what the borrowed money would achieve rather than how much the government was borrowing.

“The key question is not how much we borrow, but what we build, the value we create and the future we leave behind,” he said.

Tinubu listed the Lagos-Calabar Coastal Highway, Sokoto-Badagry Superhighway, Trans-Sahara Superhighway, electricity grid improvements and upgrades to major commercial ports in Lagos among the projects the government plans to fund.

He said the projects, alongside investments in healthcare, education and vocational training, would connect economic regions, reduce the cost of transporting goods, support farming and industries, and attract private investors.

The President said the Lagos-Calabar Coastal Highway alone could reduce transport costs along its route by 15 to 20 per cent and add up to two per cent to Nigeria’s Gross Domestic Product (GDP) through increased trade, tourism and industrial activities.

He projected that the highway would create about 100,000 direct jobs in construction and engineering, as well as more than 150,000 indirect jobs in logistics, building materials and related services.

“We are building more than highways. We are opening economic corridors, connecting markets, supporting industries and reshaping Nigeria’s economic geography,” he said.

Tinubu argued that Nigeria would need better infrastructure to achieve its target of a $1 trillion economy by 2030.

“We cannot build a $1 trillion economy with infrastructure designed for an economy a fraction of that size,” he added.

The President also pointed to improvements in some economic indicators since his administration introduced major reforms in May 2023.

He listed the removal of petrol subsidy, the unification of exchange rates, tax reforms and efforts to control inflation as measures that had helped improve the economy and government finances.

According to him, Nigeria’s economy grew by 4.43 per cent in the second quarter of 2026, while headline inflation dropped to 14.63 per cent in September from 20.98 per cent in the same period last year.

He said the country’s gross external reserves stood at $55.1 billion as of October 9, 2026, including about $46 billion in net reserves.

Tinubu also said Nigeria’s tax-to-GDP ratio had risen to 12.5 per cent from seven per cent, while net allocations from the Federation Account Allocation Committee (FAAC) increased by 44 per cent, from ₦15.2 trillion in 2024 to ₦21.9 trillion in 2025.

He said the improvements had made Nigeria more attractive to foreign investors and helped the country secure loans at better rates.

The President cited positive assessments by international credit rating agencies, Nigeria’s return to Frontier Market status and its successful Eurobond issuance as signs of growing investor confidence.

“These are not political endorsements; they are independent assessments by global rating agencies, index providers, regulators and investors, recognising stronger external reserves, improved macroeconomic management and greater financial credibility,” he said.

He added that the government was seeking longer-term loans that would allow it to repay over a period that matches the lifespan of the projects being funded.

According to him, this would reduce pressure from frequent loan repayments and help the country get better borrowing terms.

However, Tinubu acknowledged the need to control spending, noting that public debt stood at 35.75 per cent of GDP in the second quarter of 2026, while debt servicing accounted for about 65 per cent of revenue in the first half of the year.

He said the Federal Executive Council’s economic plan included avoiding the printing of money to fund budget deficits and preventing spending commitments that were not backed by available funds during the pre-election period.

The NLC, however, has challenged the Federal Government to explain why it needs more foreign loans despite its claims of increased revenue following the removal of petrol subsidy.

Speaking on Channels Television’s The Morning Brief, NLC President Joe Ajaero questioned the reason for continued borrowing from international financial institutions, including the International Monetary Fund and the World Bank.

“If you come out to tell us that subsidy is gone, that you are making more money and then you are giving more money to states, what is the justification for continually borrowing from the International Monetary Fund and the World Bank and other agencies when there is enough money?” he asked.

Ajaero also said the increase in international crude oil prices should make the government reconsider its borrowing plans.

He noted that the 2026 budget was based on an oil price of $70 per barrel, but crude oil prices had risen above $100 per barrel following tensions involving the United States and Iran.

“If the 2026 budget was prepared with crude oil price benchmarked at $70 per barrel and now sells above $100 per barrel due to the US-Iran crisis, should this country still be taking loans?” he asked.

The labour leader questioned the effect of more borrowing on Nigeria’s debt burden, arguing that higher oil earnings and increased revenue to oil-producing states should make the government explain why additional loans were necessary.

Ajaero, however, clarified that the NLC had no authority to approve or reject government loans, saying such decisions were the responsibility of the relevant government institutions.

He urged Nigerians and relevant agencies to demand greater accountability from the Federal Government over its borrowing plans.

Tinubu, meanwhile, said the success of the borrowing plan would be judged by the completion of projects and how much they improve the lives of Nigerians.

“Securing financing is only the beginning. The real achievement lies in completing projects, delivering value for money, and improving Nigerians’ lives,” he said.