President Bola Tinubu has asked the National Assembly to approve a fresh external borrowing plan of over $21.5 billion and the issuance of ₦757.9 billion in bonds to offset outstanding pension liabilities.
The requests were conveyed in three letters read on the floor of the House of Representatives on Tuesday, May 27, by Speaker Tajudeen Abbas.
In the first letter, Tinubu proposed the establishment of a foreign currency-denominated bond issuance programme in the domestic debt market.
He explained that the capital raise of up to $2 billion would be handled by the Debt Management Office under a 2023 Presidential Executive Order.
He said the funds would be channelled into key sectors like infrastructure, job creation, and foreign exchange generation.
According to him, the borrowing would also “offer dollar-denominated investment opportunities for local investors, deepen Nigeria’s financial market, and strengthen foreign reserves while promoting exchange rate stability.”
The total borrowing plan includes $21.5 billion, €2.2 billion, and ¥15 billion, alongside a €65 million grant.
“In light of the significant infrastructure deficit in the country and the paucity of financial resources needed to address this gap amid declining domestic demand, it has become essential to pursue prudent economic borrowing to close the financial shortfall,” Tinubu said.
He assured lawmakers that the funds would be used for infrastructure in all 36 states and the FCT, especially in rail transport, healthcare, and development programmes.
“This initiative aims to generate employment, promote skill acquisition, foster entrepreneurship, reduce poverty, and enhance food security, as well as to improve the livelihoods of Nigerians,” he added.
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However, the President acknowledged that the borrowing plan would increase public debt and servicing obligations.
In a second letter, Tinubu asked the National Assembly to approve the issuance of ₦757.98 billion in Federal Government bonds to clear pension arrears under the Contributory Pension Scheme as of December 2023.
Citing the Pension Reform Act of 2014, he said the government had faced difficulty meeting its pension obligations due to revenue constraints.
He explained that settling the debts would ease the hardship faced by retirees, restore trust in the pension system, and boost the economy by injecting liquidity.
“This initiative aims to alleviate hardship for retirees, restore confidence in the pension system, boost morale among public servants, and stimulate economic growth by increasing liquidity,” he stated.
The proposed bond issuance, he said, had been approved by the Federal Executive Council on February 4, 2025.
While acknowledging the likely increase in debt burden, Tinubu urged lawmakers to expedite approval and reaffirmed his administration’s commitment to transparency.
“While I look forward to the progression and timely approval of the House of Representatives, please accept, Your Honourable Speaker, the assurances of my high regards,” he wrote.
The House has referred the request to the Committees on National Planning and Economic Development and Pensions for further review.