Tinubu Pushes Urgent $2.3bn Loan, $500m Sukuk Request to NASS for Approval

President Bola Ahmed Tinubu has formally requested approval from the House of Representatives for new external borrowing and debt refinancing amounting to $2.3 billion. The request also includes the issuance of a $500 million debut sovereign Sukuk in the international capital market.

The details were presented in a letter read on the House floor by Speaker Tajudeen Abbas.

Tinubu is seeking a resolution from the National Assembly in accordance with Sections 21(1) and 27(1) of the Debt Management Office (DMO) Establishment Act, 2003.

The president said the new borrowing is aimed at implementing provisions of the 2025 Appropriation Act, refinancing maturing Eurobonds and diversifying Nigeria’s funding sources through Islamic finance instruments.

According to Tinubu, the 2025 budget provides for $9.27 billion in total new borrowings to finance the year’s fiscal deficit, out of which $1.84 billion (N1.23 trillion at an exchange rate of N1,500/$) is earmarked for external loans.

The president urged the lawmakers to authorize the Federal Government to source the funds through any of the following options:

President Tinubu — President Bola Tinubu

Issuance of Eurobonds; Loan syndication; Bridge financing from book runners; or Direct borrowing from international financial institutions.

He equally revealed that Nigeria’s $1.118 billion Eurobond, issued in 2018 at 7.625% and maturing in November 2025, will be refinanced to avoid default.

“This is a standard practice in debt capital markets,” the letter noted, adding that refinancing through Eurobonds or syndicated loans would ensure debt sustainability and investor confidence.

He further noted that the decision was inspired by the government’s “considerable success” in domestic Sukuk issuances, which have raised N1.39 trillion since 2017 for critical infrastructure, particularly road projects.

He said that the proposed international Sukuk will help bridge the country’s infrastructure funding gap and deepen its investor base.

“If the ICIEC credit guarantee is utilised, 25% of the proceeds will be used to repay relatively expensive debt obligations, while the balance will finance pre-identified infrastructure projects,” the letter stated.

Tinubu assured the House that the Federal Ministry of Finance and the Debt Management Office, DMO, would work closely with transaction advisers to secure the most favourable terms and pricing for all capital-raising efforts, subject to prevailing market conditions.