President Muhammadu Buhari wrote to the National Assembly on Wednesday, seeking approval to borrow $6.9bn.
The loan, captured under the Federal Government’s 2016-2018 External Borrowing (Rolling) Plan, is for execution of key rail projects, rehabilitation of the North-East and projects in education, agriculture and health sectors.
The Chinese, through the China Eximbank, will provide over $5.8bn of the loan, while the World Bank will make provisions for the balance.
Senate President Bukola Saraki read the letter to senators at the resumed plenary on Wednesday.
Speaker of the House of Representatives, Mr. Yakubu Dogara, also read Buhari’s letter to members at Wednesday’s session Abuja.
Among the rail projects listed are the Coastal Railway Project (Lagos-Calabar segment), which has $3.4bn; the Lagos-Kano Railway Modernisation Project (Lagos-Ibadan Segment), $1.2bn; and the Lagos-Kano Railway Modernisation Project (Kano-Kaduna Segment), $1.1bn.
Buhari explained that there was a need for the urgent approval of the loan to enable the government to meet the deadline.
The letter read in part, “As you are aware, the funds available under the China African Fund are limited and loan applications from all over African countries are funded based on first come, first served and therefore, there is an urgent need to sign these loans as soon as they are approved or we may lose out in the event that we delay in signing the loan agreement.
“These loans form part of the overall money for the rail strategy. We are in the process of completing the concession of the Port Harcourt-Maiduguri line to immediately link the eastern part of the nation.”
The letter added that further funding of $575m would be sourced from the World Bank specifically for the rehabilitation efforts in the North-East in areas ravaged by the Boko Haram insurgency.
“The World Bank has approved a sum of $575m to assist the Federal Government of Nigeria in these reconstruction and rehabilitation efforts as well as for the procurement of vaccines for national routine immunisation to eradicate polio after the outbreak in the North-East in 2016,” Buhari stated.
The letter gave highlights of the projects covered by the $575m to include “polio eradication support and routine immunisation project, $125m; community and social development project, $75m; Nigeria states health programme investment project, $125m; state education programme investment project, $100m; Nigeria youth and social support project, $100m; and FADAMA III project $50m, making a total of $575m.”
In addition, the President stated that the World Bank would support the government’s social welfare programme for vulnerable groups with another $500m, bringing the total loan portfolio to $6.926bn.
“Given the current state of our economy, we need to urgently address some of our infrastructure deficiencies in order to quicken the livelihood of our people.
“It has become imperative that we work together in an expeditious way out of recession and back to growth,” the letter added.
Dogara referred the letter to the House Committee on Loans/Aids and Debt Management after reading it to the members.
Punch
