FG Confirms $1.5bn UAE Loan Drawdown, Says Staggered Borrowing Will Cut Debt Costs

The Federal Government has confirmed drawing the first $1.5 billion from its $5 billion financing arrangement with First Abu Dhabi Bank (FAB), saying the phased approach will reduce borrowing costs while supporting infrastructure development, budget implementation, and debt refinancing.

Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, disclosed this after the Federal Executive Council (FEC) meeting in Abuja, explaining that the facility had already received approval from the National Assembly.

Oyedele said the government deliberately structured the loan to be accessed in tranches, rather than drawing the entire amount at once, to avoid paying interest on funds not immediately required.

He noted that the financing arrangement is intended to refinance expensive debt, fund infrastructure projects, and support budget implementation, adding that staggered drawdowns would improve the efficiency of debt management.

The confirmation follows reports that Nigeria recently accessed about $1.5 billion through a total return swap with First Abu Dhabi Bank, representing the first utilization of the broader $5 billion financing package.