Law News
Senate approves additional $200m loan for Jonathan

The Senate on Tuesday approved the request of President Goodluck Jonathan to raise additional $200m Diaspora Bond from the international capital market.

Jonathan had, in a letter addressed to Senate President David Mark, on February 4, 2014, sought the approval of the red chamber to increase the initial $100m earlier approved by the senators in the 2012 – 2014 Borrowing Plan.

The president had explained that the $200m increment  being sought by him was necessary in order to fund critical infrastructure in Nigeria and also afford citizens in diaspora an opportunity to invest in the development of their country.

Chairman of the Joint Senate Committee on Local and Foreign Debts, and that of Finance, Senator Ehigie Uzamere, while presenting the report, noted that several meetings were held with officials of the Debt Management Office in the course of their assignment.

Uzamere added that his committee considered the Nigeria’s Medium Term Debt Management Strategy (2012-2015), The Debt Sustainability Analysis (2013), Fiscal Responsibility Act (2007), Debt Management Act (2003) and the 2014-2016 MTEF/FSP, to arrive at its submission.

He noted that the committee considered the $100m earlier approved in the 2012 – 2014 Borrowing Plan as too small “considering the life of Nigerians in the Diaspora.”

Uzamere said the dwindling revenue from crude oil sale has made it necessary to diversify sources of funding for government.

He said, “The Diaspora bond is necessary to create more space in the domestic market for other borrowers particularly private firms.

“The Federal Government plans to utilise the proceeds of the diaspora bond in the construction of key capital projects in priority sectors of the economy.”

He explained that proceeds from the bond would be used to fund the construction of the second Niger Bridge, Lagos-Ibadan expressway,  and provision of facilities at the Abuja Medical City.

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