The Nigerian Senate has approved President Bola Tinubu’s request to borrow $516,333,007 foreign loan to support the construction of sections of the Sokoto-Badagry Superhighway.
The approval followed the consideration of the report on the loan request as presented by the Senate Committee on Local and Foreign Debts.
After the presentation of the report by Senator Adamu Aliero (Kebbi Central), all the Senators that spoke commended President Tinubu for his stride in infrastructure development which necessitated the borrowing.
Senator Tahir Monguno (Borno North) said the loan is a deserving one because the project targeted is germane to economic development of the country.
He said the Sokoto-Badagry Superhighway will unlock agric value chain, create employment and deepen the revenue base of the Federal Government.
Senator Monguno said the superhighway links three geopolitical zones—the North-West, North-Central and South-West—creating microeconomic opportunities along the corridor and opening up business across the regions.
Senator Adetokunbo Abiru (Lagos East) while lending his support to the loan, said the Superhighway will create a network of connectivity between the north and the south.
The Deputy Senate President, Senator Jibrin Barau in his contributions said that President Tinubu’s request for the loan was done in good faith.
He said that the road when completed will further enhance economic activities between the two regions.
In his remarks, the President of the Senate, Senator Godswill Akpabio commended President Tinubu on the initiative of seeking foreign financing for the important project, considering it’s socio-economic impact.
Senator Akpabio said the project will enable construction of dams along the corridor that will enhance agricultural development.
He said the Senate is ready to assist the President in realising his lofty developmental dreams by approving request of economic importance to the entire nation.
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President Tinubu had last week Thursday sought the National Assembly’s approval of USD 516,333,007 syndicated financing from Deutche Bank AG for the construction of the Sokoto-Badagry Superhighway Project section 1, Phase 1 A and 1 B.
President Tinubu said the Sokoto-Badagry superhighway, a flagship infrastructure initiative under the renewed hope agenda, is designed to open up Nigeria’s north-west and south-west economic corridor through the construction of an approximately 1,000-kilometre high-capacity carriageway, linking Sokoto, Kebbi, Niger, Kwara, Oyo, Ogun, and Lagos states, stretching from Illela to Badagry.
“The proposed financing arrangement comprises a syndicated loan to be secured through Deutsche Bank AG, supported by a partial risk guarantee from the Islamic Corporation for the Insurance of Investment and Export Credit (ICIEC), the insurance arm of the Islamic Development Bank,” President Tinubu’s letter reads.
President Tinubu said the federal government will provide counterpart funding of N265,542,689,569 to cover land acquisition, compensation, and ancillary infrastructure.
The president said the loan has a nine-year tenure, including a grace period of up to three years, with an interest rate not exceeding the Chicago Mercantile Exchange (CME) SOFR plus 5.3 percent per annum.
President Tinubu said the road project would improve network performance along the corridor, reduce logistics costs and travel time, facilitate trade and strengthen food security, promote national integration by linking production zones to markets and ports, and provide long-term intermodal flexibility through provision for future rail integration and utility corridors.
The six-lane infrastructure plan featuring rail integration and concrete technology is aimed at linking Nigeria’s Sahel region to the coastal economic hub of Badagry.
The Federal Executive Council has already approved the financing arrangement and its terms.
The present administration had maintained that borrowing is necessary to bridge the infrastructure gap and stimulate industrial development, as the national budget alone cannot cover these massive legacy projects.