Boko Haram crisis: Nigeria to pay N45bn interest on $1bn loan

Nigeria is to pay N45 billion as interest on the $1 billion foreign loan to be taken by the Federal Government for the purchase of military hardware, it emerged yesterday. President Goodluck Jonathan had in July asked the National Assembly to approve the foreign loan, which is to be used to ramp up spending on […]

Nigeria is to pay N45 billion as interest on the $1 billion foreign loan to be taken by the Federal Government for the purchase of military hardware, it emerged yesterday.

President Goodluck Jonathan had in July asked the National Assembly to approve the foreign loan, which is to be used to ramp up spending on military equipment for the battle against Boko Haram insurgency.
The House of Representatives heard yesterday that the loan is to be repaid in yearly installments of N30 billion for seven years, making a total of N210 billion.
Our correspondents report that based on this, the additional N45 billion represents interest and other charges on the principal sum of N165 billion, which is the naira equivalent of the $1 billion loan.
House of Representatives Finance Committee chairman Abdulmumini Jibril told lawmakers yesterday that during interactions with stakeholders, the committee discovered that Nigeria would have to cough out about N30 billion annually for seven years to defray the loan.
He explained that the yearly repayments would be captured in the 2015 Federal budget.
Jibrin said his committee and the Committee on Debts and Loans, which are saddled with the responsibility of interfacing with stakeholders on the loan, must ask some relevant questions on the issue. He said the panels were trying to establish the portion of the military hardware that would go to each security agency, among other issues.
Jibrin added that some of the security agencies do not even know what they would get from the equipment to be procured, hence the need to do a thorough job.
He asked the House to give them two weeks to conclude work on the loan request. But Speaker Aminu Waziri Tambuwal directed them to present their report “latest by next Tuesday.”
He said the House could not continue to wait as the matter was referred to the two committees long ago.
Tambuwal’s directive followed an observation by Deputy Leader Leo Ogor, who noted that the two committees were delaying action on Jonathan’s request.
The Senate had approved the $1 billion loan weeks ago. Jibrin later told journalists that his committee has been working harmoniously with the service chiefs and other security agencies.
He said Senate begun work on the loan long before the House, and that what delayed the House committee’s work was the absence of service chiefs and the finance minister from a session organised before the Eid el-Kabir break.
Jibrin also dismissed claims that the delay is caused by the fact that he belongs to the opposition All Progressives Congress (APC), whose members opposed the loan when the request was submitted in July.