The Ministry of Finance plans to spend about N156.2bn on major projects financed through multilateral and bilateral tied loans in the 2026 budget, with digital enterprise development and student housing receiving the largest allocations.

Details of the 2026 Appropriation Bill show that the largest component is N89.3bn allocated to the Investment in Digital and Creative Enterprises programme for the training of entrepreneurs in creativity and digital technology through the African Development Bank.

The government also earmarked another N36bn for the iDICE programme under financing from the Islamic Development Bank.

Combined, the two iDICE allocations amount to N125.3bn, accounting for the bulk of the tied-loan projects captured under the ministry’s headquarters budget.

Another N30.94bn is allocated to the Family Homes Funds housing financing project for student housing.

The three projects collectively amount to approximately N156.2bn, reflecting the scale of externally financed development programmes embedded in the Finance Ministry’s 2026 spending plan.

The allocations are coming against the backdrop of the Federal Government’s broader strategy of using borrowing and development financing to support investment while pursuing fiscal consolidation.

President Bola Tinubu’s 2026 budget speech projected total expenditure of N58.18tn and a budget deficit of N23.85tn, while stressing the need for debt discipline and value for money.

The concentration of tied-loan funding on digital enterprises is particularly significant as the government seeks to expand entrepreneurship, technology skills and participation in the digital economy.

The iDICE programme’s combined N125.3bn allocation through the African and Islamic development finance institutions represents more than 80 per cent of the N156.2bn tied-loan provisions identified in the ministry’s headquarters budget.

Beyond the externally financed programmes, the Finance Ministry’s capital budget contains several allocations aimed at improving public financial management.

These include N84m for productivity improvement in the implementation of Federal Government financial reporting programmes.

The ministry also earmarked N56m for performance assessment of the implementation of IPSAS accrual accounting, including the management of government assets and liabilities.

Another N60.9m is provided for the Efficiency Unit’s review and analysis of Federal Government overhead expenditure, while N70m is allocated to lean management.

The spending plan comes at a time when borrowing has become an increasingly important component of Nigeria’s fiscal framework. Recent analysis by BudgIT noted that the government’s 2026 budget relies heavily on borrowing to finance its deficit and development commitments.

The major challenge will therefore be ensuring that tied-loan projects deliver measurable economic and social returns, particularly in areas such as digital enterprise development and student housing, while maintaining transparency and effective monitoring of the funds.