Nigeria will pay N1.8 trillion ($4 billion) extra interest in 2023 if the National Assembly rejects a loan-to-bond swap request on the central bank’s overdrafts to the government, President Muhammadu Buhari said on Tuesday after signing the 2023 budget into law.
The Senate last week delayed a decision on the president’s request to convert $53 billion worth of central bank overdrafts to the government into 40-year bonds after some lawmakers questioned the plan.
In a speech on Tuesday, Buhari said the government currently pays a three per cent margin above the central bank’s lending rate of 16.5 per cent but his administration has negotiated a rate of nine per cent for the bonds.
Lawmakers increased the size of the 2023 budget by 6.4 per cent to 21.83 trillion naira ($49 billion) after they raised the oil price assumption to $75 a barrel from $70.
“Considering the imminent transition process … I decided to sign the 2023 appropriation bill into law … to enable its implementation to commence without delay,” Buhari said, referring to a general election coming up in February.
Having completed the maximum two terms allowed by the constitution, Buhari is not standing for re-election.
Rising debt, weak economic growth, high inflation and mounting insecurity are major issues for many Nigerian voters.