The Nigerian Senate rejected President Muhammadu Buhari’s proposal to borrow $30 billion to fund development projects in the next two years, dealing a major blow to the government’s efforts to stimulate growth in its economy.
The 109-member house threw out the plan on Tuesday last week, without debating it because the presidency did not give details to justify the borrowing.
“I was shocked. I think it was defeated on technical grounds. I will try and re-introduce it (the bill) again. We will do what is right,” Ali Ndume, Senate majority leader from the ruling All Progressive Congress told reporters.
The blow came a day after majority leader in the House of Representatives promised Senate would approve of the plan to borrow to stimulate growth the economy that has been in recession since August.
A day after the rejection, the presidency said that it will get the relevant information from the budget office, Ministry of Budget and National Planning, Ministry of Finance and the economic team and submit it to the senate in the hope that it will approve of the loan, Vanguard News reported.
The loan, which will be the biggest in the history of Africa’s biggest economy if approved is meant to fund projects in the infrastructural, agricultural, health, education, water supply and employment generation, Sahara Reporters reported.
Last week, the opposition People’s Democratic Party had urged parliament to shoot down the proposal, saying that it would plunge the country into serious debt.
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The West African nation’s 2016-17 budget has a deficit of about $6.9 billion (N2.2 trillion). In September, African Development Bank (AfDB) pledged to support the nation with $1 billion to address the huge deficit, This Day reported.
The global fall in oil prices, which is the nation’s biggest source of foreign exchange, accounting for more than 70 percent of the government income, occasioned the ongoing economic recession.
Inflation hit an all-time high of about 17.1 percent in 11 years in July.
In September, Aliko Dangote, Africa’s richest man joined the senate in calling on the government to sell its assets in efforts to fight the economic crisis instead of borrowing funds.
The presidency put up two of its jets for sale, last month in efforts to cut waste of public funds.
Some of other national assets that may be sold include, Nigeria Liquefied Natural Gas Limited, Nigerian National Petroleum Corporation, Port Harcourt Refining Company Limited, Kaduna Refining & Petrochemical Company and East-West Rail Lines, Premium Times reported.