President Muhammadu Buhari has backed Kemi Adeosun, minister of finance, on her proposed plan to seek external loans at an interest rate of 1.25 percent.
According to the presidency, Nigeria is seeking to borrow money in the form of “low cost, long-term loans,” with 1.25 percent interest rates and 20-year tenors.
This development comes barely a week after Nigeria officially entered a recession, recording two consecutive quarters of negative growth.
Adeosun had earlier revealed plans to take long-term loans at a very low interest rate from the African Development Bank, World Bank, China Exim Bank and other specific financial institutions across the world.
Kemi Adeosun has said her borrowing plan is clearly different from what obtained in the past, where Nigeria borrowed to pay salaries, stating that the government would be borrowing to invest in infrastructure and generate additional revenue.
In a series of tweets on Thursday, Buhari’s office said the borrowing plan was awaiting the approval of the national assembly.
Asides the concessional loans, the federal government said it would tap into the Eurobond market in “due course”, with Nigeria seeking to fund healthcare, mining, power and Agriculture.
The loans are part of Mr. Buhari’s recession plans, which were approved at the Council of States on Wednesday.
According to the government, the loans will be used primarily in the agriculture, power, mining development, and health sectors.
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