The Federal Government has defended President Bola Tinubu’s proposed $21.7 billion external borrowing plan, insisting that the funds are intended for long-term infrastructure and development projects rather than recurrent spending.

Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, said the proposal is a multi-year investment programme covering about five years, not an immediate drawdown.

According to him, $10.6 billion will fund major transport projects, including the Sokoto–Badagry Highway, Lagos–Calabar Coastal Highway and Kano–Kaduna Metro Rail.
Oyedele said more than $7.9 billion of the package would come from multilateral and bilateral development partners, led by a $5 billion World Bank facility at an average interest rate of about 2.1 percent.

He added that $3.3 billion is earmarked for state government projects, while $1.45 billion is set aside for the Federal Capital Territory.

“Borrowing to consume is harmful, but borrowing one naira to build transformative assets worth more than one naira creates net positive wealth for the country,” the minister said.

The Federal Executive Council also approved several financing arrangements, including a €155.9 million Deutsche Bank credit facility for five new electricity substations under the Presidential Power Initiative, and a $970 million 10-year facility for rolling stock on the Kano–Maradi rail line.

Other approvals include a €76.8 million ECOWAS Bank facility for Bauchi State’s urban and rural road networks, as well as investment in cargo inspection scanners for the Nigeria Customs Service to improve port clearance, curb smuggling and strengthen border security.

Oyedele said the government would maintain fiscal discipline as it implements the projects and seeks to translate macroeconomic recovery into tangible relief for households and businesses.