Nigeria Approves $21 Billion Borrowing Plan to Fund 2025 Budget

Edited by: Maher Al Rifai

Nigeria’s Senate has approved President Bola Tinubu’s request to secure over $21 billion in foreign and domestic borrowing to cover anticipated revenue gaps in the 2025 national budget. The decision, confirmed on Tuesday by Senate Appropriations Committee Chair Solomon Adeola, includes a mix of loans and grants: €4 billion ($4.7 billion), ¥15 billion ($102 million), a $65 million grant, and $2 billion in domestic borrowing. The funds are allocated to key sectors including infrastructure, healthcare, education, security, and housing, with $3 billion earmarked for rehabilitating the 2,044-kilometre eastern rail corridor.

The borrowing plan, initially submitted to parliament in May, signals a shift toward fiscal expansion under Tinubu’s administration. Since taking office in 2023, the president has implemented a series of economic reforms aimed at stabilizing the economy, including the removal of fuel subsidies and a significant devaluation of the naira. While intended to attract investment and improve efficiency, these measures have also led to increased inflation and a worsening cost of living for many Nigerians, prompting the government to seek alternative sources of funding to maintain public investment.

The approval by the Senate now clears the way for full budget implementation, pending final consent from the House of Representatives. The government’s reliance on external and domestic loans reflects the persistent challenge of limited internal revenue generation, despite Nigeria’s position as one of Africa’s largest economies. As pressure mounts to deliver on public services and infrastructure, the borrowing strategy highlights the administration’s balancing act between stimulating growth and managing long-term fiscal sustainability.