Senate considers Tinubu’s $7.7bn external loan request for 2026 budget

The Senate on Wednesday commenced the scrutiny of President Bola Tinubu’s request to secure a $7.7 billion (N10.79 trillion) external loan to part-finance the 2026 fiscal budget.

The upper legislative chamber referred the presidential request to its Committee on Local and Foreign Debts for detailed consideration.

The proposed borrowing represents the foreign component of the N29.2 trillion new borrowing provision contained in the 2026 Appropriation Act. The funds will be raised using a budget exchange rate of N1,400 to the dollar to bridge a projected overall budget deficit of N31.4 trillion.

In a letter dated October 26, 2026, President Tinubu informed the lawmakers that the Federal Government would explore multiple financing options, with a preference for Eurobond issuance due to its faster processing time.

“In view of this, emphasis will be on the issuance of Eurobonds, which is typically faster to conclude. Additionally, a larger amount can be raised through Eurobonds at a relatively lower cost in respect to the terms and conditions of the Eurobond.”

The President stated that the external borrowing will support priority sectors including defence and security, transportation, agriculture, power, education, and healthcare.

He added that the foreign currency proceeds, which will be received by the Central Bank of Nigeria, will boost the external reserves of the country and provide additional support for the naira.

Presiding over the plenary, Senate President Godswill Akpabio directed the committee to thoroughly examine the available borrowing options and report back as soon as practicable.

The Senate President has, however, warned against accepting the loan arrangements without adequately examining the economic implications on the country.

“So we have to go out there and search for the best terms, and that’s what they may call a win-win seller, win-win buyer approach,” Akpabio stated.

This borrowing request comes amid persistent concerns over Nigeria’s rising public debt profile, heavy debt-servicing obligations and the reliance on external borrowing to fund annual budget deficits.