Senate President Godswill Akpabio stated on Wednesday that Nigeria's planned $5 billion loan from the United Arab Emirates (UAE) has been hampered by the current conflict involving the United States, Israel, and Iran. This development has compelled the federal government to explore alternative funding sources for essential infrastructure projects.
Akpabio made these remarks during a Senate plenary session where lawmakers considered and approved President Bola Tinubu's request for a $516.3 million loan to fund the construction of the Sokoto–Badagry Superhighway.
The Senate President explained that the geopolitical instability in the Middle East has disrupted the federal government's borrowing agreement with Abu Dhabi Bank, making it urgent to secure funds from other avenues to prevent the stalling of ongoing projects.
He emphasized that the Senate's prompt approval of the $516 million facility was crucial to maintain momentum on vital national development projects.
Earlier, the Chairman of the Senate Committee on Banking, Insurance and Other Financial Institutions, Senator Adetokunbo Abiru, also discussed the difficulties the Tinubu administration faced in securing the anticipated $5 billion loan from the UAE.
President Tinubu had, in March, formally requested the Senate's approval to borrow the $5 billion, intended to cover the 2026 budget deficit and other significant financial obligations.
However, due to the delays in obtaining funds from the UAE, the federal government has shifted its focus to Deutsche Bank, successfully arranging a $516.3 million syndicated loan specifically for the Sokoto–Badagry Superhighway initiative.
The Senate subsequently granted its approval for this loan after considering the report presented by the Committee on Local and Foreign Debts, chaired by Senator Aliyu Wamakko.
This loan, which benefits from a partial risk guarantee provided by the Islamic Corporation for the Insurance of Investment and Export Credit (ICIEC), a subsidiary of the Islamic Development Bank, is a key component of a larger strategy aimed at fostering infrastructure development.
In his communication to the Senate, President Tinubu indicated that the federal government would contribute N265.5 billion as counterpart funding, allocated for land acquisition, compensation, and associated infrastructure.
He further detailed that the highway project, planned to extend approximately 1,000 kilometers from Illela in Sokoto State to Badagry in Lagos State, is designed to connect seven states and establish a vital economic link between the northwest and southwest regions.
According to the President, the project is projected to enhance transportation links, reduce logistical expenses, improve road safety, stimulate trade, and bolster food security, while also promoting national unity.
Comments (0)
You must be logged in to comment.
Be the first to comment on this article!