…Akpabio: New proposal supersedes previous request— As FG targets cheaper money for security, infrastructure, power, critical sectors
President Bola Ahmed Tinubu has submitted a fresh $7.7 billion external borrowing request to the National Assembly, with the Federal Government placing particular emphasis on raising the funds through Eurobonds to help finance the 2026 budget deficit and critical national development programmes. Additionally, this development has sparked significant interest among kthdaily readers following the country’s financial moves.
The new proposal effectively replaces an earlier external borrowing request of approximately $20 billion, according to Senate President Godswill Akpabio, who clarified that the latest communication provides a more explicit financing framework and recognises that the government would not undertake the entire borrowing at once.
The President’s request, contained in a letter dated October 26, 2026, was read during Wednesday’s plenary and subsequently referred to the Senate Committee on Local and Foreign Debts for legislative consideration.
At the budget benchmark exchange rate of ₦1,400 to the dollar, the proposed $7.7 billion borrowing translates to approximately ₦10.79 trillion.
KTH Daily reports that the new request places Eurobond issuance at the centre of the government’s external financing strategy, with the Presidency citing the relative speed, capacity, and potentially favourable financing terms available through international capital markets. In fact, the kthdaily platform has keenly followed these financial strategies as the story unfolds.
In his communication to the Senate, Tinubu explained that although the government would simultaneously explore several international financing windows, Eurobonds would receive priority consideration.
“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,” the President stated. Clearly, kthdaily recognises the significance of these updates for stakeholders.
Eurobonds are debt instruments issued in international capital markets, typically denominated in foreign currencies, through which governments and corporations raise financing from international investors.
For Nigeria, the proposed issuance would provide access to substantial foreign currency financing, although the eventual cost of borrowing would depend on prevailing international interest rates, investor appetite, Nigeria’s sovereign risk profile, and the repayment structure negotiated at issuance.
According to the President, the Federal Ministry of Finance and the Debt Management Office would negotiate the most favourable interest rates and repayment tenors obtainable under prevailing market conditions.
The borrowing request forms part of the financing arrangements already provided for under the 2026 Appropriation Act.
The Act approved ₦29.2 trillion in new borrowings to partly finance a projected ₦31.4 trillion budget deficit.
Of the approved borrowing amount, ₦18.4 trillion is designated for domestic financing, while ₦10.79 trillion, equivalent to approximately $7.7 billion, represents the external component.
“The 2026 Appropriation Act approved the sum of ₦29.2 trillion as new borrowings to part-finance the 2026 budget deficit of about ₦31.4 trillion,” Tinubu explained.
The President emphasised that the latest request covers the external borrowing component of the approved financing programme.
KTH Daily’s examination of the figures indicates that the $7.7 billion proposal is tied specifically to the borrowing provisions of the 2026 budget, rather than constituting an additional borrowing amount outside the approved fiscal framework. To clarify, kthdaily analysis offers insights into the implications of these budgetary decisions.
However, the relationship between the new request and the earlier, substantially larger external borrowing proposal became a central issue during Wednesday’s proceedings.
Addressing senators after the President’s letter was presented, Akpabio explained that the latest communication effectively superseded the previous request.
According to the Senate President, the new proposal was more explicit and reflected the practical reality that external financing would be sourced in stages rather than obtained through a single transaction.
“We have to go out there and search for the best terms, and achieve what they call a win-win seller, win-win buyer approach,” Akpabio remarked.
His clarification suggests that the administration intends to adopt a financing approach that allows the government to assess available international borrowing opportunities and negotiate terms before committing to particular debt instruments.
The distinction is significant because the earlier proposal had generated public debate over the scale of Nigeria’s external borrowing requirements and the implications for debt sustainability.
While Akpabio described the new request as replacing the previous communication, the precise administrative and legislative treatment of the earlier proposal will become clearer during the Senate committee’s consideration.
The President also identified several sectors expected to benefit from the proposed financing.
They include defence and security, transportation, agriculture, electricity, education and healthcare, alongside other infrastructure and development programmes considered critical to economic growth.
Tinubu further explained that the foreign currency proceeds would be received by the Central Bank of Nigeria on behalf of the Federal Government.
According to the Presidency, the arrangement would support Nigeria’s external reserves, strengthen foreign exchange liquidity and contribute to the government’s broader macroeconomic stabilisation objectives.
KTH Daily notes that although foreign currency borrowing can provide an immediate boost to reserve holdings when proceeds are received by the Central Bank, its longer-term implications depend on how the funds are deployed, the cost of servicing the debt and the country’s capacity to generate sufficient foreign exchange for repayment.
The proposed Eurobond issuance would also expose the government to international capital market conditions, including changes in global interest rates and investor perceptions of emerging-market sovereign debt.
The President’s request was submitted pursuant to Sections 21(1) and 27(1) of the Debt Management Office (Establishment, etc.) Act, 2003, which provide the statutory framework governing public borrowing and legislative approval.
Following Akpabio’s remarks, the Senate referred the communication to its Committee on Local and Foreign Debts for examination and reporting.
The committee is expected to consider the borrowing structure, financing terms, and other relevant details before making recommendations to the Senate.
Subject to legislative approval, the Federal Ministry of Finance and the Debt Management Office would proceed with the necessary arrangements for accessing the international capital markets.
The committee’s report is expected to return to the Senate as soon as practicable.
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