President Bola Tinubu has formally requested the House of Representatives’ approval to secure $2.35 billion in external borrowing to partially finance the 2025 budget deficit and refinance Nigeria’s maturing Eurobonds.
The request, outlined in a letter addressed to House Speaker Tajudeen Abbas, was read on the floor of the House on Tuesday. Tinubu also seeks authorization to issue a $500 million debut sovereign sukuk in the International Capital Market (ICM) to fund infrastructure projects and expand Nigeria’s sources of financing.
The President noted that the borrowing proposal is in line with Sections 21(1) and 27(1) of the Debt Management Office (Establishment) Act, 2003, which require legislative approval for new loans and refinancing arrangements.
The proposed $2.35 billion includes $1.23 billion (N1.84 trillion) allocated in the 2025 Appropriation Act to help cover the budget deficit, and $1.12 billion to refinance a Eurobond maturing on November 21.
“The Federal Government has recorded considerable success issuing Sukuk in the domestic capital market to fund critical infrastructure projects,” the letter read. “Between September 2017 and May 2025, the DMO has raised N1.39 trillion through domestic Sukuk for road infrastructure projects. However, it is necessary to tap external sources to complement domestic funding and bridge infrastructure gaps, while diversifying the investor base and deepening the federal government securities market.”
Tinubu said the funds would be raised through one or a combination of instruments, including Eurobonds, loan syndications, or bridge financing facilities, depending on prevailing market conditions. He noted that pricing for the new Eurobonds is expected to align with current yields on existing Nigerian bonds in the international market, ranging from 6.8 percent to 9.3 percent depending on maturity.
Regarding the $500 million sovereign sukuk, the President emphasized that it would help diversify Nigeria’s investor base, deepen the government securities market, and finance critical infrastructure projects nationwide.