Presidency, N/Assembly reach deal on $1bn loan

The presidency and the National Assembly have reached a deal that will permit the government to take $1billion Euro bond to stimulate the country’s economy, a credible source said yesterday.

President Muhammadu Buhari sent the request to the National Assembly on Thursday, the day federal legislators adjourned sitting till February 21.

The letter, according to the source, was signed by Acting President Yemi Osinbajo.

The deal on the bond was reached following a meeting between Osinbajo, Senate President Bukola Saraki and the Speaker of the House of Representatives, Yakubu Dogara.

Sources said the two presiding officers have agreed to call the legislators from their break to consider and approve the $1billion bond request.

“The letter came after we have suspended plenary and after the meeting of the Senate President and the Speaker with the Acting President, they have resolved to reconvene in order to consider the President’s request,” a source close to the meeting said.

The source said National Assembly leaders were expected to meet at Saraki’s residence to decide on a date to reconvene.

He said the executive resolved to take the Euro bond following rejection of the $29.9billion loan request sent to the National Assembly late last year.

“Because of the public outcry and the rejection by the Senate, the Executive has dropped the idea of the $29.9billion loan,” he said.

The closed-door meeting with Osinbajo was held at the Vice President Wing of the Aso Rock Presidential Villa in Abuja.

The meeting was also attended by the Finance Minister Kemi Adeosun and her Budget and National Planning counterpart, Udoma Udoma.

The Senate president later told State House correspondents that the National Economic Management Team briefed the meeting on its proposed road show.

Saraki said: “We are meeting on the economy and the budget; myself, the vice president and the speaker, minister of budget and minister of finance.

“We are aware that the economic team will soon be going on a road show, and just to brief us and let us know the issues and just carry us along.

“We have just started the defence. So, there are no issues, these are just consultations.”

The Federal Executive Council (FEC) has approved five transaction advisors for the planned floating of a $1billion Euro bond, Adeosun said.

The minister said ‎the appointed advisors were expected to run issuance programmes for the next three years to avoid the cumbersome process of re-tendering and selection.

She explained that the “$1 billion Euro bond programme was part of the funding for 2016 budget and “we hope to be able to commence the process in January.”

FG: No $29.9bn loan, no projects

The Minister of Transportation, Rotimi Amaechi said failure by the National Assembly to approve the $29.9 billion loan request by President Muhammadu Buhari would scuttle major railway projects in the country.

Specifically, the minister said Lagos-Calabar coastal standard gauge rail project and the Lagos to Kano standard rail project might be frustrated as 85 percent of their funding was coming from the Chinese EXIM Bank.

The minister who briefed the Senate Committee on Land Transport yesterday during budget defence said these projects were tied to the $29.9 billion external borrowing plan earlier sent to the Senate for approval by the president.

Amaechi said both projects were estimated to cost $6.1 billion and Nigeria is to provide just 15 percent of the counterpart funding while China EXIM Bank will provide the 85 percent.

The Minister also disclosed that already, a $1.5 billion facility is hanging in China on the rail project as he cannot go and sign since the National Assembly is yet to approve the borrowing plan.

“It will do us good if the National Assembly can approve the loan because the $6.1 billion for the projects is part of the borrowing plan. What the National Assembly has already approved is the counterpart funding which is N72 billion and we have paid in Naira but the remaining 85 percent, which is huge, is coming from China as a loan.

“Even now, the China EXIM Bank has approved N1.5 billion for the Lagos-Ibadan line but we are not able to go and sign the loan agreement because we need the approval of the National Assembly,” he said.

DailyTrust