The 2023 presidential candidate of the Peoples Democratic Party (PDP), Atiku Abubakar, has expressed deep concern over the approval of a $2.2 billion external loan request by President Bola Tinubu, warning that it would impose a heavy burden on the Nigerian economy. Atiku criticized the loan, claiming it would put immense pressure on the nation’s financial system, especially when loans are not effectively negotiated or utilized.
The Senate approved the loan on Thursday, just two days after President Tinubu submitted his request. The approval, which was granted without any dissenting votes, follows a report by the Chairman of the Senate Committee on Local and Foreign Debts, Senator Aliyu Wamakko (APC, Sokoto North). The loan is intended to support the administration’s fiscal strategy for 2024, and it is part of the external borrowing plan already incorporated into the 2024 budget. The $2.2 billion, or N1.77 trillion, will be raised through Eurobonds and other borrowing mechanisms.
In a statement, Atiku Abubakar condemned the approval, highlighting that Nigeria is sinking deeper into debt, making it the third most indebted country to the International Development Association (IDA), according to a recent World Bank report. The former Vice President also pointed out that the loan is being proposed at an exchange rate of 1 USD to N800, even though the Central Bank of Nigeria’s current exchange rate is above N1,600 to 1 USD.
Atiku raised questions about the government’s rationale for borrowing when President Tinubu had previously boasted about record revenue collections from the Federal Inland Revenue Service (FIRS) and Customs. He suggested that the administration’s reliance on loans, despite these high revenue figures, was indicative of a lack of transparency in the government’s fiscal management.
Atiku also criticized the National Assembly for approving the loan, accusing lawmakers of being complicit in what he described as a “loan racket.” He expressed concern that the continuous borrowing was not being directed toward infrastructure or developmental needs but was driven by corruption.
Moreover, Atiku lamented that the country’s debt situation had worsened, despite the fact that former President Olusegun Obasanjo had worked to reduce Nigeria’s foreign debt burden. He noted that only a few years ago, Nigeria had successfully cleared its foreign debts, but now, under President Tinubu, the country had once again become heavily reliant on borrowing.
The PDP presidential candidate called for more caution in managing the nation’s finances, urging the government to reconsider its borrowing strategy and ensure that any loans secured are used effectively for the nation’s development.
