Nigeria is still struggling under the weight of increasing public debt stock which stood at N32.22 trillion as of September 30, 2020.
The Nigerian President Muhammadu Buhari has successfully jumped the last hurdle for his government’s plan to borrow fresh $1.5 billion and €995 million.
The Nigerian Senate on Wednesday approved the fresh external loans for the government.
The red chamber okayed the foreign loans after considering the report of its committee on local and foreign debts during Wednesday’s plenary session.
Clifford Ordia, chairman of the committee, told the lawmakers that the panel had considered the loan request and was recommending its approval.
The €995m loan is meant for agricultural mechanisation across the 774 LGAs while the $1.5bn loan will be used to fund critical infrastructure in the aftermath of the COVID-19 pandemic across the 36 states and the federal capital territory.
The lawmakers gave their nod for the loan request despite that Nigeria is struggling under the weight of increasing public debt stock which stood at N32.22 trillion as of September 30, 2020.
Moreover, the committee on local and foreign debts had earlier expressed concerns regarding the loans while they were being considered.
During one of its sittings in March, the Ordia-led panel faulted the action plan presented by Mohmmamed Nanono, minister of agriculture and rural development.
The lawmakers had said the minister could not provide enough insight into how the federal government intends to deploy the funds for the agricultural projects.
The minister’s argument was mostly based on the ministry’s plan to utilise about 50 million hectares of land not being used across the country for mechanised farming.
“The ministry is seriously in bilateral partnership with Brazil where 300 tractors are to be bought and imported for the project this year once the loan is approved….all these plans of ours, are geared towards food security in the country the population of which will be 400 million in about 40years from now,” he had said.
But the committee had faulted his presentation, arguing that “beautiful plans are different from practical implementation.”
Adelere Oriolowom one of its members, had said: “The tractors you are planning to bring from Brazil will, in no distant time, run aground by people who are not trained for proper usage of such machines as it happened in Osun and Borno states recently.
“Capacity building is very important for people to be engaged in the mechanised farming which we didn’t hear from your presentation. And are you in touch with the real farmers who, if actually involved, will make the project impactful?
“Beautiful plans like the ones you have just unfolded, are not new in this country. Please rejig the plans to be in tune with productivity needs of the real or rural farmers if you don’t want the money being sought for to go down in drains.”
On the $1.5bn infrastructural loan, the panel had said it cannot be approved unless the Debt Management Office (DMO) provides details on the creditworthiness of all the states.