The Nigerian government has submitted a proposal to borrow over $21.5 billion from foreign and domestic sources as part of its 2025–2026 Medium-Term Borrowing Plan, aimed at addressing fiscal deficits, funding key sectors, and sustaining recent economic gains. President Bola Ahmed Tinubu formally requested National Assembly approval for loans amounting to €2.2 billion ($2.5 billion) from international lenders, ¥15 billion ($104 million) from Japanese sources, and an additional $2 billion in domestic borrowing.
The loans, if approved, would account for approximately 60% of projected federal spending in the upcoming fiscal year, which is expected to exceed ₦35 trillion ($23 billion). According to government officials, the funds will support critical development projects across infrastructure, agriculture, health, education, water supply, security, digital economy, financial reforms, and job creation. The administration says this approach will target concessional financing and aims to prioritize foreign direct investment (FDI) and equity inflows to reduce reliance on high-interest debt. Finance Minister Wale Edun recently emphasized that the new borrowing strategy seeks to cut borrowing costs and stabilize public finances.
This marks a continuation of President Tinubu’s reformist agenda, which began in 2023 with the removal of the petrol subsidy and naira floatation to unify exchange rates. While these policies boosted government revenues and attracted investor interest, they also triggered soaring inflation (above 33% in April 2025), widespread hardship, and mounting social pressure.
Despite the economic strain, the World Bank recently reported that Nigeria recorded its highest economic growth rate in nearly a decade in 2024, citing improved oil revenues, non-oil sector expansion, and better fiscal management. However, the World Bank also warned that the benefits of growth are being eroded by inflation, rising food prices, and youth unemployment. It urged the government to adopt targeted social interventions and strengthen public debt sustainability, which currently hovers around 46% of GDP.
The new borrowing plan will require approval from both chambers of Nigeria’s National Assembly and aligns with broader discussions around the 2025 budget, which the presidency is expected to present in July.
