Tinubu Requests NASS Approval for External Loans, Pension Bond

President Bola Tinubu has formally requested approval from the National Assembly for a substantial new borrowing plan exceeding $21.5 billion in external loans and ₦757.9 billion in domestic bond issuance to settle outstanding national pension liabilities.

He conveyed three separate letters to the National Assembly, which were read by House Speaker Tajudeen Abbas. In the first letter, he requested legislative approval to establish a foreign currency-denominated debt issuance program in the debt market.

The proposed capital raise of up to $2bn would be executed by the Debt Management Office in line with the Presidential Executive Order on Foreign Currency Denominated Financial Instruments, Local Issues Programme, 2023. The borrowing will be used to stimulate critical sectors, especially infrastructure, job creation, and foreign exchange inflows.

He also highlighted that the proposed dollar-denominated bond initiative would give local investors access to foreign currency investment options, deepen Nigeria’s financial market, stabilize the exchange rate, and strengthen Nigeria’s foreign reserves. Under the external borrowing plan, the administration is seeking a total of 21,543,647,912, EUR 2,193,856,324.54, and 15 billion Japanese Yen in addition to €65 million in grant support.

“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,” the president stated.

President Tinubu assured the National Assembly that the requested funds would be strategically directed toward vital infrastructure projects, focusing on railway modernization, improvements in the healthcare sector, and development initiatives across all 36 states and the Federal Capital Territory.

He added, “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.” Tinubu acknowledged that the programme would contribute to an increase in Nigeria’s public debt stock and servicing costs.

In a separate request, he sought legislative approval for the issuance of ₦757.98 billion in Federal Government bonds to clear outstanding pension liabilities under the Contributory Pension Scheme as of December 2023. Citing the Pension Reform Act (PRA) 2014, Tinubu explained that persistent revenue constraints had hindered the government’s ability to meet its pension obligations over the years.

He emphasized that settling the outstanding liabilities would ease hardship for retirees, restore trust in the pension system, and enhance public service morale. He stated this would also increase liquidity in the economy, potentially spurring growth.

The president explained that the proposed bond issuance, which received Federal Executive Council approval on February 4, 2025, comes with both the benefits and cost implications, including the expected increase in public debt stock and debt servicing obligations. Tinubu appealed to lawmakers for swift approval, reaffirming to them his administration’s dedication to transparency and accountability.

The House of Representatives has referred President Tinubu’s borrowing and bond issuance requests to relevant committees for further legislative action, specifically, the Committee on National Planning and Economic Development and the Committee on Pensions.