Senate okays $8bn for medium-term external borrowing

By Henry Umoru & Joseph Erunke ABUJA — The Senate, yesterday, gave President Goodluck Jonathan the approval to go ahead with external borrowing to the tune of $8,209.53 billion to enable him fund the proposed pipeline projects under the medium-term (2012-2014).
The approval by the Senate is higher than the original $7.9 billion requested by President Jonathan.
The Senate also noted that the Federal Government’s external debt profile was presently at a level it could accommodate more borrowings without exceeding the international limit of 40 per cent Debt/GDP ratio  and the country’s limit of 25 per cent.
Also recommended by the upper chamber was the approval of projects to be implemented by Federal Government and its agencies, just as it approved projects for states which the amount for on-lending has been stated.
The approval by the Senate was upon discussions on the report of the Senator Ehijie Edobor Uzamere (ACN, Edo South) led Joint Committee of Local and Foreign Debts and Finance on proposed pipeline projects under the Medium-Term (2012-2014) External Borrowing plan.
According to the proposed total loan amount, states will have $2,263.239 billion; Federal, $4,846.3 billion, totalling $7,109.53 billion while continuation of the Eurobond issuance for federal projects is $1 billion and Diaspora Bond for Federal Government is $0.1 billion.
The lawmakers also called for robust oversight by relevant committees on the implementation of the projects for which these loans were being approved, just as the Senate deferred projects for states under any facility which the amount for on-lending is not stated.