By Olatunbosun Obafemi
President Bola Ahmed Tinubu has requested the approval of the National Assembly to borrow ₦1.15 trillion from the domestic debt market to help finance the deficit in the 2025 budget.
The request was contained in a letter read on the floor of the Senate by Senate President Godswill Akpabio during Tuesday’s plenary.
According to the President, the proposed borrowing is part of efforts to bridge the funding gap in the 2025 fiscal plan and ensure the full implementation of key government programmes and projects. The move, he said, aligns with the fiscal framework underpinning the 2025 Appropriation Act, which already provides for domestic and external borrowing to support capital expenditure and social investments.
Following the reading of the letter, the Senate President referred the request to the Senate Committee on Local and Foreign Debt for legislative scrutiny. The committee has been directed to report back within one week for further consideration.
The new borrowing request underscores the Tinubu administration’s increasing dependence on the domestic debt market to finance its budget deficit amid persistent revenue shortfalls. Although the government has stepped up efforts to boost non-oil income through tax reforms and digital revenue collection, fiscal pressures remain high due to growing debt service costs, fuel subsidy arrears, and security spending.
Nigeria’s public debt stood at about ₦121 trillion as of mid-2025, according to data from the Debt Management Office (DMO), with domestic borrowing accounting for roughly 60 percent of the total. Analysts have expressed concern that continued reliance on debt financing could crowd out private sector borrowing and increase inflationary pressures, especially with interest rates hovering around record highs.
Fiscal experts, however, note that domestic borrowing remains the government’s preferred option given the relative stability of the local market compared to volatile external conditions. “Borrowing locally helps manage exchange rate risks,” an Abuja-based economist told The Impact Nigeria Newspaper. “But the government must pair it with strong fiscal discipline to avoid unsustainable debt growth.”
The Senate’s approval of the new loan is expected to come after detailed scrutiny by the debt committee, as the administration seeks to balance spending priorities with the need to maintain fiscal stability.
