The National Assembly was encouraged by the President, Major General Muhammadu Buhari (retired), to reconsider his plan to securitize the remaining Ways and Means balance owed by the Federal Government to the Central Bank of Nigeria.
He cautioned that failing to approve the securitization will result in a 40-year repayment timeframe for the securitized debt and increased interest costs to the government of nearly N1.8 trillion in 2023. Just one week has passed since the Senate rejected Buhari’s request to restructure the N22.7 trillion in Ways and Means advances.
Given the difference between the applicable interest rates, which are currently MPR plus 3% and the negotiated interest rate of 9% and a 40-year repayment period on the securitization, failure to grant the securitization approval will nevertheless cost the government about N1.8 trillion in additional interest in 2023.
He thanked the National Assembly for approving his request for an extension of its validity date to March 31, 2023.