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FG borrowed 25trn in Q1 2023 from CBN – Report

The Federal Government borrowed N1.83tn from the Central Bank of Nigeria through the Ways and Means loan in the first quarter of 2023.

Provisional data from the apex bank through its quarterly statistical bulletin disclosed this recently.

According to the data, the additional figure of N1.83 trillion had pushed the federal government’s borrowing from the CBN to N25.36tn in March 2023 to N23.53tn in December 2022.

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The Ways and Means Advance is a loan facility the central bank uses to finance the government during temporary budget shortfalls, subject to limits imposed by law.

According to Section 38 of the CBN Act, 2007, the apex bank may grant temporary advances to the Federal Government concerning the temporary deficiency of budget revenue at such interest rate as the bank may determine.

The Ways and Means Advance had been a subject of controversy.

Financial experts believed the CBN exceeded its lending threshold to the federal government. Meanwhile, the Debt Management Office in May announced the securitization of CBN’s N22.7 trillion Ways and Means advance to the federal government.

Nigeria’s total debt stock rose to N49.85 trillion without adding CBN’s Ways and Means Loans.

This is as the Senate during the week approved a request by President Bola Tinubu for a $800 million loan to fund the National Social Safety Net Programme set up by the National Assembly.

The Senate further amended the 2022 Supplementary Budget.

The President had forwarded the request in a letter passed through Senate President, Goodswill Akpabio, which was read before the National Assembly at plenary.

In the letter, Tinubu recalled that the Federal Executive Council led by ex-President Muhammadu Buhari had approved an additional $800 million loan to be secured from the World Bank, to finance the Social Safety Net Programme.

He further stated that the loan was for expanding the coverage of shock responsive safety net supports for all and vulnerable Nigerians to meet the cost of their basic needs.

“Request for approval of additional financing of the National Social Safety Net Programme set up by the National Assembly. It is with pleasure that I refer the above matter to you,” the statement read in part.

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