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Buhari wants N’Assembly’s nod to raise N2.3bn to finance 2021 budget deficit

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The Senate on Tuesday received a request from President Muhammadu Buhari to raise the sum of N2,343,387,942,848 from multilateral and bilateral lenders, as well as the International Capital Market (ICM) through the issuance of Eurobonds.

The amount which is equivalent to USD$6,183,081,643.40 at the Budget Exchange Rate of USD$1/N379, is captured as New External Borrowing in the 2021 Appropriation Act (Item No.330), and meant to part-finance this year’s Budget Deficit of N5.602 trillion.

The request was contained in a letter addressed to the Senate President, Ahmad Lawan, and read during plenary.

According to the President, the request was made in line with the provisions of Sections 21(1) and 27(1) of the Debt Management Office (Establishment) Act, 2003.

He disclosed that Nigeria may be able to raise USD$3 billion or more, in a combination of tenors between 5 – 30 years.

Buhari explained that the Federal Government’s decision to raise the sum from the International Capital Market was due to the recent monetary policy stance that provides for very low interest rates and ease of moderating debt service cost.

He further disclosed that the proceeds of the USD6.183 billion (N2.343 trillion New External Borrowing in the 2021 Appropriation Act) would be used to fund specific Capital Projects in the Budget.

According to him, such projects are captured in priority sectors of the economy, namely: Power, Transportation, Agriculture and Rural Development, Education, Health, Provision of Counterpart Funding for Multilateral and Bilateral projects, Defence and Water Resources.

President Buhari’s letter, “Request For the Resolution of the National Assembly For: The Implementation of the New External Borrowing of N2.343 trillion (about USD6.183 Billion) In the 2022 Appropriation Act”, reads in part:

“The purpose of this Letter is to request for a Resolution of the National Assembly (NASS) to raise the sum of N2,343,387,942,848.00 (about USD 6,183,081,643.4O at the Budget Exchange Rate of USD1.00/N379) provided as New External Borrowing in the 2021 Appropriation Act (Item No. 330) to part-finance the Budget Deficit of N5.602 trillion.

“This request is in line with the provisions of Sections 21(1) and 27(1) of the Debt Management Office (Establishment, Etc.) Act, 2003 (DMO Act). Section 21(1) of the DMO states that “no external loan shall be approved or obtained by the Minister unless its terms and conditions shall have been laid before the National Assembly and approved by its Resolution”; while Section 27(1) states that the National Assembly may by a resolution approve, from time to time, standard terms and conditions for the negotiation and acceptance of external loans and issuance of guarantees”.

Implementation of the New External Borrowing in the 2021 Appropriation Act

“The President of the Senate may wish to recall that the 2021 Appropriation Act provides for N4,686,775,885,696.00 as New Borrowings(Item No. 328) to part-finance the 2021 Fiscal Deficit, of Which 50% or N2,343,387,942,848.00 (about USD 6,183,081,643.40 at the Budget Exchange Rate of USD1.00/N379) is specified as New External Borrowing.

“The President of the Senate may also wish to note that the allocation of #2.343 trillion to New External Borrowing in the 2021 Appropriation Act is consistent with the Nigeria’s Debt Management Strategy, which seeks amongst other objectives, to moderate

debt service costs by accessing relatively cheaper external funds, and to free-up space in the  domestic market for other borrowers.

Funding Plan

“I wish to bring to the attention of the President of the Senate that the plan is to raise the sum of USD 6.183 billion from a combination of sources; namely: multilateral and bilateral lenders, as well as from the International Capital Market (ICM) through the issuance of Eurobonds.

“From recent bends in the ICM, it is now possible for Nigeria to raise funds in the ICM and this explains why we are proposing that the New External Borrowing in the 2021 Appropriation Act, should include issuing Eurobonds in the ICM.

“We estimate that Nigeria may be able to raise USD 3 billion or more, but not more than USD 6.183 billion (the amount provided in the 2021 Appropriation Act) in a combination of tenors between 5 30 years; the outcome would, however, be determined when Nigeria approaches the market.

“The President of the Senate may further wish to note that not only is the ICM now open to issuers like Nigeria and Interest Rate lower than the levels in 2020, given the recent monetary policy stance, as well as, rising levels of inflation, the level of liquidity in the domestic market has decreased while. domestic Interest Rates are beginning to rise.

“Therefore, accessing the ICM will be relatively cheaper thereby moderating debt service cost, and it will also contribute to the level of External Reserves.”

Utilisation of Proceeds of New External Borrowing

“The proceeds of the USD6.183 billion N2.343 trillion New External Borrowing in the 2021 Appropriation Act) will be used  to found specific Capital Projects in the Budget.

“This includes projects from priority sections of the economy, namely: Power, Transportation, Agriculture and Rural Development, Education, Health, Provision of Counterpart Funding for Multilateral and Bilateral projects, Defence and Water Resources.”

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Defence and Security

Zamfara Govt Dethrones Two Emirs, District Head Accused Of Aiding Banditry

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Zamfara State Governor Bello Matawalle
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The Zamfara State government has dethroned two emirs and a district head over allegations of aiding the activities of bandits terrorising communities in the state.

Those affected by the government’s decision include the Emir of Zurmi, Abubakar Atiku, Emir of Dansadau, Hussaini Umar, as well as Sulaiman Ibrahim who used to be the District Head of Birnin Tsaba.

Mr Ibrahim Dosara, who is the Commissioner for Information in Zamfara, made the announcement on Wednesday while briefing reporters at the end of the State Executive Council meeting in Gusau, the state capital.

“The council has approved the deposition of Emir of Zurmi, Alhaji Atiku Abubakar, and that of Dansadau, Alhaji Hussaini Umar,” he declared.

“The council also approved the immediate removal of the District Head of Birnin-Tsaba, Alhaji Sulaiman Ibrahim.”

According to the commissioner, the government has also ordered that all land titles issued by the affected traditional leaders be revoked.

“The State Executive Council has also directed the state Ministry of Justice to issue an executive order to back up the council resolution,” he added.

The deposition of the traditional leaders comes 10 months after they were suspended by the state government.

It also comes days after the submission of the reports of the committees set up by the state government to investigate the allegations against the affected traditional rulers.

“The council upheld the recommendation of a six-man white paper committee set up by the government to review the report of two separate committees earlier set up to investigate the involvement of the three traditional rulers in the activities of banditry in the state,” said a statement by Governor Bello Matawalle’s media aide, Zailani Bappa.

“The three impeached royal fathers were earlier suspended by the state government following wide allegations of serious involvement in the act of banditry in the state.

“The findings of the committees also revealed abuse of the Land Act in their domain and the government ordered the reversal to status quo involving the lands illegally allocated.”

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Defence and Security

Senate Passes Amended Terrorism Act, Criminalises Payment Of Kidnap Ransom

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Senator Michael Opeyemi Bamidele
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The Senate has prohibited the payment of ransoms to kidnappers in its bid to complement the Federal Government’s effort to tackle the disturbing spate of insecurity in the country.

Payment of kidnap ransom was criminalised by the lawmakers during Wednesday’s plenary in Abuja as they passed the Terrorism (Prevention) Act 2013 (Amendment) Bill, 2022.

The prohibition by the lawmakers followed the receipt and consideration of a report by the Senate Committee on Judiciary, Human Rights, and Legal Matters on the bill.

Senator Michael Opeyemi Bamidele, who chairs the committee, had moved that the lawmakers receive the report after which he presented it for consideration.

Thereafter, the lawmakers resolved into the committee of the whole to consider the report, clause by clause, and reverted to plenary to report progress.

This led to the reading of the Terrorism (Prevention) Act 2013 (Amendment) Bill, 2022 for the third time and its subsequent passage.

In his remarks, the Senate President, Ahmad Lawan, congratulated his colleagues on the passage of the bill which he said was very important.

“It is believed here in the Senate that this bill, by the time it is signed into Act by Mr President, will enhance the efforts of this government in the fight against terrorism, kidnapping, and other associated vices,” he said.

“This is one piece of legislation that can turn around not only the security issues of Nigeria but even the economy of the country.

I believe that the Executive will waste no time in signing this bill into law and it is our hope that this additional piece of legislation will achieve the purpose for which it has been worked upon.”

According to Lawan, the fight against insecurity is not the sole purpose of a government and the contributions and support of the citizens are essential.

He explained that this was because the security agencies need critical information to tackle terrorism, kidnapping, and other threats to the nation’s security.

The Senate President stated that the security agencies were trying their best but needed to do more and achieve better results.

“With this, once again, I want to congratulate the Senate for this very important piece of legislation,” he concluded.

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Defence and Security

DSS Alerts on renewed Bomb Explosions

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The Department of State Services (DSS) has said some criminal elements plan to return the country to the pre-2015 era reminiscent of Improvised Explosive Device (IED) attacks on soft and hard targets in parts of the country.

The Public Relations Officer of the security agency, Dr Peter Afunanya, raised the alarm in a statement on Tuesday in Abuja.

He stated that while the DSS has received reports on cases of such incidents in some areas, it has uncovered a plot by suspected criminal gangs to forge an alliance.

Their objective, Afunanya explained, was to launch further attacks on critical infrastructure and other public places frequently visited, such as worship and relaxation centres, especially during and after the holidays and festive celebrations.

He added that the groups intend to achieve some self-serving interests and cause fear among the people, and warned managers and owners of such centres to be cautious and implement basic security measures to deter the threats.

The DSS said it would continue to disrupt the trend and pattern of violent attacks and asked the people to go about their lawful businesses

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