The Federal Government has assured Nigerians of a sustainable borrowing framework that prioritises economic growth and fiscal discipline, following President Bola Tinubu’s formal request to the National Assembly for approval of the 2024–2026 External Borrowing Rolling Plan.
In a press statement on Wednesday by the Director of Information and Public Relations at the Ministry of Finance, Mohammed Manga, the government clarified that the borrowing plan is a strategic, forward-looking framework designed to guide external borrowing by both federal and sub-national governments over the next three years.
The plan, which is part of the Medium-Term Expenditure Framework and compliant with the Fiscal Responsibility Act 2007 and the Debt Management Office Act 2003, includes detailed appendices outlining projects, terms, conditions, and implementation periods.
It aims to enhance comprehensive financial planning and reduce inefficiencies caused by reactive borrowing.
Importantly, the statement noted that the borrowing rolling plan “does not equate to actual borrowing for the period,” with the specific borrowing figures determined annually through the budget process.
For 2025, the external borrowing component stands at $1.23bn, which is yet to be drawn and is planned for the second half of the year, the statement noted.
The external borrowing request comes amid recent reports that Nigeria’s public debt is set to increase by about $24 billion, adding roughly N38 trillion to the national debt stock over the period, pushing total debt beyond N182 trillion by 2026.
The government, however, emphasised that the borrowing plan will not automatically increase the debt burden, as most loans are project-tied with multi-year drawdowns spanning five to seven years.
These projects cover critical sectors such as power grids, irrigation to boost food security, fibre optics networks, security fighter jets, and transportation infrastructure including rail and roads.
Most loans will be sourced from Nigeria’s development partners, including the World Bank, African Development Bank, French Development Agency, European Investment Bank, JICA, China EximBank, and the Islamic Development Bank.
These partners offer concessional financing with favourable terms and long repayment periods, which the government says supports “Nigeria’s development objectives sustainably.”
The statement further highlighted progress in reducing Nigeria’s debt service to revenue ratio, which peaked above 90 per cent in 2023 but has since started to decline.
The government claims to have ended “distortionary and inflationary ways and means” of financing and anticipates significant revenue boosts from the Nigerian National Petroleum Corporation and improved revenue collection from government-owned enterprises and agencies through technology-enabled monitoring.
The government assured that borrowing decisions will focus on the utility, sustainability, and economic returns of the loans.
The statement read, “Having achieved a fair degree of macroeconomic stabilization, the overarching goal of the Federal Government is to pivot the economy onto a path of rapid, sustained, and inclusive economic growth.
“Achieving this vision requires substantial investment in critical sectors such as transportation, energy, infrastructure, and agriculture. These investments will lay the groundwork for long-term economic diversification and encourage private sector participation.
“Our debt strategy is therefore guided not solely by the size of our obligations but by the utility, sustainability, and economic returns of the borrowing. Ensuring that all borrowed funds are efficiently utilized and directed toward growth-enhancing projects remains a top priority.”
The Federal Government reaffirmed its commitment to keeping borrowing “within manageable and sustainable limits” according to the DMO Debt Sustainability Framework, and noted that ongoing tax reforms and revenue initiatives will further strengthen financial management.
