The Nigerian Senate has approved President Bola Ahmed Tinubu’s request to borrow ₦1.15 trillion from the domestic debt market to help fund the 2025 national budget. The loan is aimed at covering part of the country’s growing budget deficit, following an increase in government spending for the coming fiscal year.
The approval was granted during Wednesday’s plenary session after the adoption of a report presented by the Senate Committee on Local and Foreign Debt. The report recommended that the National Assembly give the green light for the borrowing, which will be sourced from the domestic debt market.
According to the committee’s findings, the 2025 Appropriation Act — Nigeria’s main spending plan for the year — makes provision for a total expenditure of ₦59.99 trillion. This represents an increase of ₦5.25 trillion from the ₦54.74 trillion earlier proposed by the Executive before it was passed into law.
This adjustment created a total budget deficit of ₦14.10 trillion, out of which ₦12.95 trillion had already been approved for borrowing. The remaining ₦1.15 trillion (₦1,147,462,863,321) was left unfunded, prompting the President’s latest request.
In the same session, the Senate also adopted a motion sponsored by Senator Abdul Ningi, calling for stronger oversight on how the borrowed funds are used. The motion directed the Senate Committee on Appropriations to ensure that every naira of the loan is spent strictly on projects and programmes approved under the 2025 fiscal plan.
Senator Ningi emphasized that while borrowing can be a useful tool for national development, misuse or poor management of borrowed funds often leads to waste and debt accumulation. The Senate, therefore, resolved that close monitoring would help ensure transparency and accountability in the implementation of the 2025 budget.
President Tinubu had, in a letter dated November 4, written to the National Assembly seeking approval for the ₦1.15 trillion loan. The letter, which was read during plenary by Senate President Godswill Akpabio, explained that the borrowing was necessary to bridge the funding gap and ensure the smooth implementation of critical government projects and programmes.
Tinubu stated that the funds would be raised from the domestic debt market rather than through foreign borrowing. The choice of domestic borrowing, according to government officials, is meant to reduce the risks associated with exchange rate volatility and dependence on foreign creditors.
After the letter was read, Senate President Akpabio referred the request to the Senate Committee on Local and Foreign Debt, chaired by Senator Aliyu Wammako (APC, Sokoto North). The committee was directed to study the proposal and submit its report within one week — a timeline it met before Wednesday’s approval.
Nigeria’s growing reliance on borrowing to finance its annual budgets has remained a major topic of debate among economists, civil society groups, and opposition lawmakers. While the government argues that loans are needed to fund key infrastructure and social programmes, critics warn that excessive borrowing could push the country deeper into debt and reduce funds available for other priorities.
In recent years, Nigeria’s public debt profile has continued to rise. According to the Debt Management Office (DMO), the country’s total public debt stood at about ₦97.3 trillion as of mid-2024. This figure includes both domestic and external debts owed by the federal and state governments. Analysts have warned that with the 2025 borrowing plans, the country’s debt stock could exceed ₦100 trillion before the end of next year.
Economists have also pointed out that a significant portion of Nigeria’s annual revenue is used to service existing debts, leaving little room for new development spending. In the 2025 budget, debt servicing is expected to take a large share of expenditure, further tightening fiscal space for other critical sectors like education, healthcare, and infrastructure.
The 2025 national budget, which was signed into law earlier this year, is anchored on an oil price benchmark of $78 per barrel and an exchange rate of ₦850 to the US dollar. The government expects to generate revenue mainly from oil exports, non-oil taxes, and proceeds from government-owned enterprises.
President Tinubu has repeatedly said his administration is committed to achieving economic stability, job creation, and infrastructure renewal through prudent management of resources. The government also hopes that ongoing economic reforms — including the removal of fuel subsidies and exchange rate unification — will eventually boost revenue and reduce the need for heavy borrowing in future budgets.
However, many Nigerians continue to face hardship as a result of the reforms, with rising prices of food, transportation, and basic goods putting pressure on household incomes. The government’s plan to borrow more money has therefore drawn mixed reactions from the public.
During the Senate debate, several lawmakers who spoke on the matter stressed the importance of ensuring that borrowed funds are used efficiently. Senator Aliyu Wammako, who presented the committee’s report, said the approval was granted after a careful review of the President’s request and the nation’s fiscal situation.
He assured that the funds would be used to finance key capital projects that can stimulate economic growth and create jobs. “This borrowing is not for consumption but for development,” he said. “The Senate will continue to monitor its implementation to ensure it benefits the Nigerian people.”
Other senators, including those from the opposition, expressed concerns about Nigeria’s increasing debt levels but agreed that the country currently faces a financing gap that must be addressed to prevent government activities from stalling.
With the Senate’s approval, the federal government is now expected to begin the process of raising the ₦1.15 trillion from the domestic market through bonds and treasury bills. The funds will help bridge the deficit and ensure continued funding for priority sectors in the 2025 fiscal year.
