The Nigerian Senate has approved President Bola Tinubu's request to secure $6 billion in external loans, including a $5 billion financing programme with First Abu Dhabi Bank and a $1 billion loan from UK Export Finance. The approval came within four hours of Senate President Godswill Akpabio presenting the presidential letters during Tuesday's plenary. The decision followed the submission of a report by the Committee on Local and Foreign Debts, chaired by Senator Aliyu Wamakko, which recommended the approvals after review. The $5 billion facility is structured as a total return swap (TRS) with the UAE-based First Abudba Dhabi Bank, a financial arrangement that allows Nigeria to access funds against future oil revenues or other state-backed assets. In the second request, President Tinubu sought Senate consent for a $1 billion loan arranged by Citibank's London branch, backed by UK Export Finance, specifically for the overhaul of the Lagos Port Complex and Tin Can Island Port. The administration cited port modernization and infrastructure development as key reasons for the borrowing.
When President Tinubu pushes for a $5 billion swap deal tied to future oil returns, it signals growing reliance on complex financial instruments amid dwindling revenue options. This move shifts Nigeria's debt profile toward riskier, market-linked obligations rather than straightforward loans. That the Senate approved both loans in under four hours suggests a pattern of rapid, minimally scrutinized borrowing to fund urgent infrastructure needs. Without transparent safeguards, such speed risks long-term fiscal exposure for short-term gains.
