2026 budget targets debt refinancing, key infrastructure funding

Both chambers of the National Assembly Tuesday passed for third reading, N68.3 trillion as aggregate budget profile for the 2026 fiscal year.

The sum is N9 trillion above N58.472 trillion proposed by President Bola Ahmed Tinubu in December last year.

The N9 trillion increase in the approved budget arose from adjustment made to the earlier proposal by President Tinubu and concurred with by the federal lawmakers.

The passage of the N68.3 trillion 2026 budget by both chambers followed harmonised reports submitted to that effect by their committees on appropriations.

As stated in the report presented by Chairman Senate Committee on Appropriations Olamilekan Adeola (Ogun West), the adjustments effected in the Budget were “the outstanding unfunded capital obligations amounting to N5.71 trillion arising from the 2025 Appropriation (Repeal and Enactment) Act, as well as N2 trillion capital for priority projects across multiple sectors and locations nationwide, which were omitted in the rollover to the 2026 Appropriation Bill.

“Federal Government equity contribution of N478.60 billion under the Ministry of Finance Incorporated (MOFI) framework for the Presidential Legacy Light Rail Projects in Lagos, Kano, Kaduna, and Ogun States, including feasibility studies for the Enugu and Maiduguri Urban Light Rail Projects, as well as the narrow-gauge railway network;

“The provision of N8.96 billion for detailed feasibility studies for the Calabar–Maiduguri Corridor (traversing the North Central Zone) and the Maiduguri–Sokoto Superhighway under the Tinubu National Beltway Initiative.

“An additional US$344.83 million, equivalent to approximately N482.76 billion, for priority health sector interventions tied to existing bilateral understandings and implementation commitments and a further provision of N98.50 billion for the Court of Appeal and N36.7 billion for the Supreme Court in support of the institutional architecture for the 2027 General Election cycle; and N268.54 billion for the reinstatement of the Judiciary’s budget ceiling, as well as additional provisions to accommodate the prospective appointment of more Justices of the Court of Appeal and Judges.”

The N68.3 trillion budget as explained by Senator Adeola, has N4.79trillion as Statutory Transfer , N15.4trillion as recurrent expenditure , N32.2 trillion as capital expenditure and N15.8trillion for debt servicing.

According to him, aside from the oil price benchmark of $65 moved to $75, other parameters the budgetary proposals were predicated upon were retained as proposed and as contained in the 2026 – 2028 Expenditure Framework and Fiscal Strategy Paper .

…Wants religious implementation

The committees, however, stated in the report that the executive should implement the budgetary proposal very religiously through prompt releases and adequate funding.

“That bureaucratic bottleneck that led to the challenges of late releases of funds in 2025 should be addressed holistically, to achieve the Theme of 2026 Appropriations Bill From Budget to Impact.

“Deliberate efforts must be made in 2026 by the Senate in collaboration with the Executive to implement 2026 Appropriation holistically.

“The 2026 budget implementation should be monitored by the various committees, with a purpose to manage and guide capital projects implementation with discipline, and pursue infrastructural growth that is broad based with sustainable legislation,: the report stated.

In  his remarks after the passage of the bill. Senate President Godswill Akpabio said the budget, if well implemented, would further take Nigeria out of the doldrums.

…Fresh $6bn foreign loans approved

Also on Tuesday, the Senate gave expeditious approval to $6billion foreign loan requests forwarded to it by President Tinubu.

President Tinubu, had in two separate letters of request to the Senate read in plenary by  Akpabio, disclosed plans to obtain $5 billion from First Abu Dhabi Bank and an additional $1 billion from UK Export Finance.

According to the president, the $5 billion facility is aimed at bridging financing gaps in the 2026 budget, while the $1 billion loan will be deployed for the rehabilitation of Lagos ports—considered a vital component of Nigeria’s trade and logistics infrastructure.

One of the letters read in part: “The purpose of this letter is to request the approval and resolution of the National Assembly to establish a structured Total Return Swap (TRS) external financing programme of up to $5 billion.

“The facility, to be arranged with First Abu Dhabi Bank, will be made available to the Federal Government of Nigeria in tranches.

“The programme is intended to support budget implementation, fund key infrastructure projects, and refinance more expensive domestic and external debts.

“It will also enable the government to meet other urgent financial needs as may be approved.

“The proposed loan of $5 billion will increase Nigeria’s public debt stock, which currently stands at $110.3 billion as of December 31, 2025, with projected debt service of about N20.5 trillion for 2026.

“The drawdown will be done in tranches to ensure sustainability in debt stock and servicing.

“I request the Senate to consider and approve the terms and conditions of this loan proposal and to authorise the issuance of Federal Government securities as collateral”.

Speaking after presenting the letter, Senator Akpabio commended the president for securing the financing arrangement during a recent trip to the United Kingdom, describing it as a positive outcome of Nigeria’s international engagements.

“This development is one of the gains of the recent engagement with the United Kingdom. I was present when the agreement was signed, and I must commend the President for his efforts. The results are beginning to show,” he said.

Akpabio also read a second letter which urged the Senate to approve a $1bn UK-backed loan for Lagos, Tin Can ports rehabilitation.

According to the letter, the proposed United Kingdom Export Finance (UKEF)-backed facility is being arranged by Citibank London and other financiers.

The letter said that the loan is intended to fund the reconstruction and upgrade of the two critical ports under an Engineering, Procurement and Construction plus Finance (EPC+F) model to be implemented by the Nigerian Ports Authority (NPA).

The project, according to Tinubu, is a strategic modernisation initiative aimed at restoring infrastructure at the ports, which have operated for between 50 and 100 years and are now at advanced stages of deterioration.

It noted that the rehabilitation would address decades of infrastructure deficits, improve operational efficiency, enhance safety standards, and align the facilities with global best practices.

The federal government also said the project would boost Nigeria’s competitiveness as a maritime hub and support the diversification of the economy through increased non-oil exports.

A breakdown of the financing shows that $429.7 million is earmarked for the Lagos Port Complex, comprising $373.2 million for commercial contract financing and $56.5 million for UKEF premium. Tin Can Island Port is to receive $571.1 million, including $496 million for commercial financing and $75.1 million for the UKEF premium.

The facility has a tenure of up to 14 years, with an availability period of 48 months.

The UKEF premium, estimated at 1.07 per cent per annum, is payable upfront but can be financed as part of the loan.

The proposal has already secured approval from the Federal Executive Council, according to the letter.

In his remarks on the request, Akpabio said the condition of Tin Can Island Port has been a source of concern because obsolete equipment there like breakwaters was constructed as far back as 1901.

He added that the situation has made Nigeria less attractive to international shipping lines, with many vessels opting for neighbouring ports.

“The implication is that the current is too strong, and ships experience delays. Many now prefer to berth in neighbouring countries, making Nigeria less attractive for maritime business,” he said.

The Senate President also commended President Tinubu for securing the financing arrangement during a recent engagement in the United Kingdom.

“This development is one of the gains of the recent engagement with the United Kingdom. I was present when the agreement was signed, and I must commend the President for his efforts. The results are beginning to show,” he added.

The proposed borrowings are part of ongoing efforts by the government to strengthen fiscal capacity and tackle infrastructure deficits, particularly in the maritime sector.