By Jemimah Wellington, JKNewsMedia Correspondent
NIGERIA’s PUSH for a proposed $1.25bn World Bank (WB)loan to support economic reforms, job creation, and competitiveness has reached a critical stage in the lender’s approval process.
JKNewsMedia.com reports that the proposed facility, titled “Nigeria Actions for Investment and Jobs Acceleration”, is scheduled for consideration on June 26, 2026, according to the revised timetable of the Independent National Electoral Commission (INEC).
Reports showed that the loan, if approved, would become the second largest single World Bank facility secured under President Bola Tinubu after the $1.5bn Reforms for Economic Stabilisation to Enable Transformation Development Policy Financing approved in June 2024.
At an exchange rate of N1,361.4 to the dollar, the proposed facility is valued at about N1.70tn.
Data showed that Nigeria’s external debt could rise from N74.43tn or $51.86bn as of December 31, 2025, to at least N76.13tn or $53.11bn if the loan is approved and fully disbursed.
The country’s total public debt could also increase from N159.28tn to at least N160.98tn. In dollar terms, total public debt could rise from $110.97bn to about $112.22bn.
Details contained in a World Bank Programme Information Document (WBPID) showed that the facility had moved beyond the concept and appraisal phases and reached the decision meeting stage of the bank’s project cycle.
The stage allows the lender’s management to review the final appraisal package and determine whether the project should proceed to the Board of Executive Directors (BED) for approval.
The document stated, “The review did authorise the team to appraise and negotiate.”
The Federal Republic of Nigeria (FGN) is listed as the borrower, while the Federal Ministry of Finance will serve as the implementing agency.
The World Bank said the facility is designed “to support the government’s efforts to expand access to finance, digital, and electricity services, and strengthen competitiveness through tax, trade, and agriculture reforms.”
Other reports further showed that the World Bank approved about $9.35bn in loans and credits for Nigeria between June 2023 and May 2026 across sectors including power, education, healthcare, agriculture, renewable energy, MSME financing, and economic reform support.
The approvals include the $2.25bn RESET and ARMOR reform financing in June 2024, $1.57bn for HOPE and SPIN programmes in September 2024, and $1.08bn for education and resilience programmes in March 2025.
Approval of the proposed facility would raise total World Bank approvals under Tinubu to about $10.6bn.
The report noted that many approved loans are not immediately disbursed because fund releases are tied to specific policy and reform conditions.
The Accountant-General of the Federation, Dr Shamseldeen Ogunjimi, had earlier warned that Nigeria might reject World Bank loan facilities if approval and disbursement delays continue.
A statement issued by the Director of Press and Public Relations at the Office of the Accountant General of the Federation, Bawa Mokwa, quoted Ogunjimi as saying during a visit by a World Bank delegation led by Mrs Treed Lane that Nigeria expected timely processing of funding requests.
He said, “If approvals take more than six months, the Nigerian Government may no longer honour such arrangements.”
Ogunjimi urged the World Bank to “expedite the approval and disbursement of project funds to Nigeria” to support the country’s priorities.
The Senior External Affairs Officer at the World Bank, Mansir Nasir, had earlier said funds for projects financed by the institution were released in instalments depending on the nature of the project and financing instruments.
Analysis of external debt stock data released by the Debt Management Office showed that Nigeria’s debt to the World Bank rose by $2.08bn within one year to $19.89bn as of December 31, 2025, from $17.81bn recorded at the end of 2024.
The World Bank debt includes loans from the International Development Association and the International Bank for Reconstruction and Development.
Data from the DMO showed that Nigeria’s IDA debt increased from $16.56bn in 2024 to $18.51bn in 2025, while IBRD exposure rose from $1.24bn to $1.38bn.
World Bank loans accounted for 38.36 per cent of Nigeria’s total external debt stock of $51.86bn as of the end of 2025.
The proposed facility aligns with the World Bank’s Country Partnership Framework and forms part of interventions including FINCLUDE, BRIDGE, AGROW, ARMOR, and DARES programmes.
According to the bank, the operation is expected to support growth through reduced food and input costs, improved agricultural productivity, expansion of digital services, deeper financial markets, increased private investment, improved electricity access, and stronger tax revenue mobilisation.
“The $1.25bn standalone operation builds on recent progress in restoring stability and underpins the Government’s shift toward an inclusive growth model,” the document stated.
Implementation will be coordinated by the Federal Ministry of Finance alongside agencies including the Central Bank of Nigeria, Securities and Exchange Commission, National Agricultural Seed Council, Nigerian Electricity Regulatory Commission, and the Ministry of Power.
The World Bank, however, warned that the operation carried significant risks ahead of the 2027 elections.
“Overall, the risk to this DPF is assessed as high. Political and governance risks are elevated ahead of the 2027 elections, with pressures that could delay or reverse sensitive reforms,” the bank stated.
Economist Adewale Abimbola said loans from multilateral institutions such as the World Bank were largely concessionary with lower interest rates and longer repayment periods.
“If it’s concessionary and tied to viable projects with medium term revenue prospects, I don’t think it’s a bad idea,” Abimbola said. “Borrowing isn’t bad; what matters is utilisation.”
Development economist and Chief Executive Officer of CSA Advisory, Dr Aliyu Ilias, questioned the rationale for increased borrowing at a time the government had announced improved revenue inflows after fuel subsidy removal.
The Chief Executive Officer of the Centre for the Promotion of Private Enterprise, Dr Muda Yusuf, said debt sustainability depended on Nigeria’s revenue capacity and warned against excessive foreign borrowing because of exchange rate risks.
Meanwhile, the Nigerian Economic Summit Group said Nigeria’s debt outlook remained fragile despite signs of improvement.
In its Debt Burden Monitor report released yesterday, the NESG said the Debt Burden Index declined to 70.9 points in 2024 from 83.6 points in 2023 but warned that the improvement reflected moderation in debt service pressures rather than stronger fiscal capacity.
The group said public debt to GDP rose to 40.6 per cent in 2024, reflecting continued reliance on borrowing and weak revenue generation.
“This pattern indicates that debt pressure has not structurally eased but instead fluctuates within a high stress band,” the report stated.
The NESG added that Nigeria remained in a “high risk fiscal environment.”
More reports added from other media publications …
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