The Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, has defended the Federal Government’s proposed $21.7 billion external financing plan, insisting that the funds are intended to support productive investments rather than simply increase Nigeria’s debt burden.
Oyedele made the clarification on Wednesday while responding to questions from State House correspondents after the Federal Executive Council (FEC) meeting presided over by President Bola Tinubu at the Presidential Villa in Abuja.
His comments followed criticism from former Vice-President Atiku Abubakar, who urged the National Assembly to withhold approval of the proposed borrowing until the government provides sufficient details about the projects and their financing arrangements.
President Tinubu had requested legislative approval for external financing comprising $20.52 billion and €1.045 billion to fund projects and programmes across several sectors.
The proposed financing covers transportation, security, healthcare, agriculture, energy, digital infrastructure, education and social protection.
Responding to concerns about the plan, Oyedele argued that the financing should be assessed based on the assets it would create and the economic benefits expected from the projects.
“This is investment, not borrowing,” the minister said.
He explained that the government intended to use the funds for projects capable of strengthening national productivity, supporting economic growth and improving the living standards of Nigerians.
Oyedele also noted that the proposal was a financing plan and did not mean that the government would necessarily access the entire amount.
Transportation Takes Largest Allocation
The minister disclosed that transportation infrastructure accounts for approximately $10.6 billion of the proposed financing.
The allocation is expected to support major projects, including the Sokoto-Badagry Highway, Lagos-Calabar Coastal Highway and Kano-Kaduna railway project.
He said the government was exploring financing opportunities from multilateral and bilateral development partners, alongside other sources, to implement the projects.
According to Oyedele, approximately $7.9 billion is expected from multilateral and bilateral partners, including the World Bank.
He disclosed that a $5 billion component from the World Bank would attract concessional financing at an average interest rate of about 2.1 per cent, while some loans for social-sector projects would carry interest rates of around two per cent.
The minister said the government was prioritising favourable financing conditions to reduce borrowing costs and ensure that the projects deliver long-term economic benefits.
Atiku Demands Greater Transparency
Atiku had questioned the timing and justification for the proposed financing, asking the National Assembly to demand comprehensive information about the projects before granting approval.
The former vice-president argued that Nigerians should be given details of the proposed projects, including their locations, costs and contractors, to enable proper scrutiny of the government’s spending plans.
He also expressed concern about the country’s debt obligations and the possibility that the funds could be mismanaged.
Meanwhile, Oyedele disclosed that the Federal Government was targeting single-digit inflation by the end of 2027 or earlier.
He maintained that the administration’s broader objective was to convert economic reforms and infrastructure investments into sustainable growth, employment opportunities and improved living conditions for Nigerians.
