In a significant move to bolster Nigeria’s economic recovery and support its vulnerable populations, the World Bank has approved a combined financial package worth $2.25 billion for the West African nation. This substantial funding comes at a critical juncture, providing immediate financial and technical assistance to Nigeria’s urgent efforts to stabilise its economy.
The package comprises two key operations:
- Nigeria Reforms for Economic Stabilisation to Enable Transformation and Development Policy Financing Programme: A $1.5 billion loan designed to enhance Nigeria’s economic stability and promote fiscal sustainability.
- Nigeria Accelerating Resource Mobilisation Reforms Program-for- Results: A $750 million loan aimed at supporting Nigeria’s ambitious, multi-year plan to increase non-oil revenue generation and safeguard oil revenues.
According to a statement released by the World Bank on Thursday, this combined financial infusion is intended to enable the delivery of quality public services in Nigeria, a nation grappling with economic challenges exacerbated by the global pandemic and fluctuating oil prices.
“The World Bank’s approval of this $2.25 billion package underscores its commitment to supporting Nigeria’s efforts to overcome economic hurdles and create a more stable and prosperous future for its citizens,” said David Malpass, President of the World Bank Group.
The loan package offers favourable terms, including a 40-year repayment period, a 10-year grace period, and a nominal interest rate of just 1%. This advantageous structure reflects the World Bank’s recognition of Nigeria’s urgent need for economic assistance and its determination to promote long-term fiscal sustainability.
Nigerian Finance Minister Wale Edun had previously announced the government’s qualification for this loan during the spring meetings of the International Monetary Fund and the World Bank last month, describing it as “virtually a grant” due to its extremely favourable terms.
As Nigeria embarks on its economic recovery journey, the World Bank’s substantial financial support and technical expertise are expected to play a pivotal role in stabilising the economy, boosting revenue generation, and safeguarding resources for delivering essential public services to the nation’s citizens.