Despite Concerns over Rising Debts, Senate to Approve Buhari’s $30bn Loan Request


•Says president has provided details of borrowing plan
•PSC bill passage to generate additional N420bn for 2020 budget

Iyobosa Uwuguaren, Deji Elumoye and Chuks Okocha in Abuja

Despite huge concerns over Nigeria’s rising debt profile, the President of the Senate, Dr. Ahmad Lawan, yesterday said with sufficient information supplied by the federal government to back its request to borrow $29.9 billion, the Senate would approve the external loan request.

He also said the Production Sharing Contract (PSC) Bill recently signed into law by President Muhammadu Buhari would provide more revenue for the implementation of the 2020 budget.

Highlighting his achievements since he assumed office six months ago, Lawan told reporters yesterday in Abuja that unlike what happened in the Eighth Senate, Buhari had provided all information and details required to ensure the passage of the loan request.

Lawan said the Senate would approve the loan based on a critical and prudent assessment of the request.
“Yes, the Ninth Senate will approve the loan request. It is true that the Eighth Senate did not approve the loan request because there was no sufficient information. But this time around, we have been provided better information and details about the loan.

“Though, information has been provided, we shall definitely seek and ensure more explanations, to enable us to take the right decision. In 2016, no detailed information was provided. The executive has learnt its lessons and came up with more information. The Senate will approve the loan request,” the Senate president added.

Lawan’s position yesterday was a clear departure from his position in October when he spoke against borrowing by the federal government to fund infrastructure.

He had at a public hearing on the 2020 budget said: “We cannot continue to borrow to build our infrastructure. I belong to that school that believes that where we can have a PPP to build our infrastructure, we should do that.

“I feel that if we can build our road from Abuja to Kaduna or Kano with private fund and they design a way to collect their money, let us do that. Other countries have done that and it worked. As long as we are not shortchanged, we have to look at it.”

The president had last month re-presented to the Senate for approval a proposal to borrow $29.96 billion foreign loan to fund some critical projects – but still did not present a detailed draft plan for that loan request – a major reason the Dr. Bukola Saraki-led Eighth National Assembly refused to approve it.

Also, former chairman, Senate Committee on Local and Foreign Debt in the Senate, Senator Shehu Sani, had explained why the president’s request to borrow the fund was turned down by the Eighth Senate.

He had said: “We turned down the federal government loan request for $30 billion to save Nigeria from sinking into the dark gully of a perpetual debt trap. We don’t want our country to be recolonised by creditor banks.

“Our external debt in 2015 was $10.32 billion and it escalated to $22.08 in the second quarter of this year, which is 114 per cent. If we had approved that loan request, our external debt could have catapulted to over $52 Billion and that is not sustainable.”

But yesterday, Lawan explained that the availability of more revenue will enhance the smooth implementation of the 2020 budget, as the passage and signing into law of the Production Sharing Contract by the National Assembly would bring in over N420 billion to finance the 2020 budget.

“This law will significantly increase accruals to the government from crude oil contracts. It has also ended our years of inexplicable failure to call in returns due to us from our joint venture partners. As a result of this law, we have expanded a critical revenue stream and ensured more funds will flow into the treasury that will enable the government to execute its budgets and critical developmental projects”, he said.

On the controversial hate speech and anti-social media bills currently before the National Assembly, he assured Nigerians that the National Assembly would not pass any law against national interest.

According to him, the Hate Speech Bill will undergo a public hearing and the outcome will determine the fate of the bill.

“If it gets to public hearing level, people should mobilise and if they are able to gather enough support they can determine what becomes of the bill, especially if it is against the interest of the public,” Lawan added.

On the achievements of the Ninth Senate so far, he said they had passed six bills into law, four of which, are private members bills.

“Within the first six months of its inauguration, the Ninth Senate has passed six bills into law; four of them members’ bills. “The first of these bills is the Deep Offshore and Inland Basin Production Sharing Contracts Act CAP D3 LFN 2004 (Amendment Bill, 2019,” he stated.
Lawan listed the two executive bills passed as the Appropriation Bill, 2020 and the Finance Bill 2019.

“We passed the Finance Bill, 2019 on 21 November, 2019. The Bill amended seven existing tax and fiscal policy laws (Companies Income Tax Act, 2004; Value Added Tax Act, 2007; Customs and Excise Tariff (Consolidation) Act, 2004; Personal Income Tax Act, 2007; Capital Gains Tax Act, 2007; Stamp Duties Act, 2007; and Petroleum Profit Tax Act, 2004) to reform Nigeria’s tax system for enhanced implementation and effectiveness,” he said.

He explained that the federal government took the initiative to reform the tax system to create an enabling business environment and reduce the tax burden for Micro, Small and Medium Enterprises (MSMEs).

The objectives of the amendments, he said, included promoting fiscal equity by mitigating instances of regressive taxation, reforming domestic tax laws to align with global best practices, introducing tax incentives for investment in infrastructure and capital markets, supporting small businesses in line with ongoing” Ease of Doing Business Reforms” and raising revenues for the government.

However, Lawan identified some of the bills that will be accorded priority when the Senate returns from Christmas break in January to include the Petroleum Industry Bill (PIB), Electoral Reforms Amendment Bills and Amendment of the 1999 Constitution.

The Petroleum Industry Bill, he said, was first introduced in the National Assembly in 2007 but had not been passed in its entirety.
Lawan explained that the National Assembly will this time around adopt a different approach to make the passage of the PIB a reality.

He said: “We want to see a situation where the legislature and the executive work very closely to have a PIB that will attract investment into the oil and gas sector in Nigeria. We want to create an investment climate that will be competitive. We know some other countries have this product; therefore, we have to be competitive, we have to create an environment where the businesses make profit.

“This is a journey that involves everyone. We want both government – and that includes the legislature and executive – on the one hand and other relevant stakeholders in the sector, particularly the IOCs (International Oil Companies), to work together to ensure that this environment we are trying to create is an environment that will work for all of us.”

He said the Electoral Reforms Amendment Bill was a priority because of the urgent need to improve the electoral processes and secure the democratic gains being made in the Fourth Republic.

According to him, “We want to pass the bill well ahead of the next electoral cycle in 2023 and avoid the political heat and pitfalls that imperiled the efforts of the Eighth National Assembly, which passed the same bill close to the last general election.

“We are not oblivious of the interest and concerns some of these bills have generated from the public. But we must not forget that lawmaking is a rigorous process that allows for all sides of the argument to be heard and the true will of the people established before a bill becomes law.”

Giving assurances on the passage of the electoral bill, the Senate president said: “I pledge that we, as elected representatives of the people, will always ensure that the will of our people is pivotal in our legislative business. This Senate and indeed the Ninth National Assembly will not pass any bill that is not in the national interest. Ours is and will remain a Senate that will always work for Nigerians.”