President Bola Ahmed Tinubu has asked the National Assembly to approve a fresh external loan of $7.7 billion (about N10.79 trillion) to help finance the 2026 budget deficit.
Tinubu’s request was contained in a letter dated October 26, 2026, which Senate President Godswill Akpabio read during Wednesday’s plenary.
The president said the proposed borrowing represents the external financing component of the N29.2 trillion approved for new borrowing under the 2026 Appropriation Act.
The amount comprises N18.4 trillion in domestic borrowing and N10.79 trillion in external loans to part-finance the projected N31.4 trillion budget deficit.
In the letter, Tinubu said the request was made in accordance with Sections 21(1) and 27(1) of the Debt Management Office (Establishment, etc.) Act, 2003, which require legislative approval for external borrowing.
He said the government would explore different international financing options, with a preference for Eurobond issuance because of its relatively faster processing and capacity to raise larger amounts.
“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 said.
Tinubu added that the Ministry of Finance and the Debt Management Office (DMO) would negotiate favourable interest rates and repayment periods based on prevailing market conditions.
The proposed loan, according to the president, would support projects in defence and security, transportation, agriculture, power, education and healthcare.
He also said the foreign currency proceeds would be received by the Central Bank of Nigeria (CBN) on behalf of the federal government.
According to Tinubu, the arrangement would help strengthen Nigeria’s foreign reserves, support exchange rate stability and reinforce the government’s economic reforms.
Akpabio speaks on earlier $20.5bn loan request
Reacting to the latest proposal, Akpabio said it effectively superseded an earlier request for external loans worth about $20.5 billion and €1.04 billion.
The Senate President said the new communication provided a clearer explanation of the government’s borrowing plans, particularly because the funds would not necessarily be sourced from a single lender or financing arrangement.
“I believe this letter effectively supersedes the earlier request for 20.3 billion US dollars because the present request is more explicit. It also recognises that the borrowing will not necessarily come from one source,” he said.
Akpabio added that the government would need to explore available financing options and negotiate favourable terms.
“The government will have to explore the available options and secure the best possible terms under a willing-seller, willing-buyer arrangement,” he said.
He subsequently referred the request to the Senate Committee on Local and Foreign Debts for further consideration and a report.
Nigeria’s growing borrowing needs
The latest request comes amid increased reliance on domestic and external borrowing by the federal government to finance budget deficits and infrastructure projects.
In March, the National Assembly approved a $6 billion external borrowing plan, comprising a $5 billion facility from First Abu Dhabi Bank to support the national budget and a $1 billion export finance facility arranged by Citibank for the rehabilitation of Tin Can Island Port and the Lagos Port Complex.
The lawmakers also approved a $516.3 million loan from Deutsche Bank AG to finance the construction of the Sokoto-Badagry Superhighway.
The facility has a nine-year repayment period, including a grace period of up to three years.
Nigeria’s rising debt profile has continued to attract attention, particularly over the proportion of government revenue spent on servicing loans.
While the federal government has defended borrowing as necessary to fund infrastructure and development projects, concerns remain over revenue generation and the country’s capacity to meet its growing debt obligations.