FG in Advanced Talks With World Bank for Fresh $1.25bn Loan Facility

FG in Advanced Talks With World Bank for Fresh $1.25bn Loan Facility

The Federal Government is currently in advanced negotiations with the World Bank over a proposed $1.25 billion loan facility aimed at supporting economic reforms, investment growth, job creation, and improved competitiveness in Nigeria.

Details of the proposed financing were contained in a World Bank project document titled “Nigeria Actions for Investment and Jobs Acceleration,” which showed that discussions have moved into the critical decision-meeting stage of the lender’s approval process ahead of possible Board consideration on June 26, 2026.

The project has already progressed beyond the initial concept, appraisal, and negotiation stages, indicating that major policy reforms, financing terms, and implementation conditions have largely been agreed upon between Nigerian authorities and the World Bank team.

According to the document, the loan 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.”

If approved, the facility would become one of the largest loans secured by President Bola Tinubu’s administration and the second-largest World Bank financing package obtained by Nigeria since the approval of the $1.5 billion Reforms for Economic Stabilisation to Enable Transformation Development Policy Financing in June 2024.

The borrower is officially listed as the Federal Republic of Nigeria, while the Federal Ministry of Finance will serve as the implementing agency for the programme.

Under the World Bank approval system, the decision-meeting phase represents one of the final internal stages before projects are forwarded to the institution’s Board of Executive Directors for formal approval.

The World Bank document stated: “The review did authorise the team to appraise and negotiate,” indicating that the proposed facility has successfully passed key internal assessments and is moving closer to final approval.

READ ALSO:

• Oshiomhole Wants Nigeria to Take Over MTN Over Xenophobia
• Trump Expands Efforts to Revoke Citizenship of Some Foreign-Born Americans
• Israel Jails Soldiers Over Virgin Mary Statue Desecration in Lebanon

The fresh loan discussions come amid growing public scrutiny over Nigeria’s rising debt burden and increasing dependence on multilateral financing to support reforms and infrastructure development.

According to recent debt figures, Nigeria’s external debt stood at approximately $51.86 billion as of December 31, 2025, while the country’s total public debt profile has risen to about $110.97 billion.

Reports show that between June 2023 and May 2026, the World Bank approved approximately $9.35 billion in loans and credits for Nigeria across sectors including power, healthcare, education, agriculture, renewable energy, social protection, MSME financing, and fiscal reform support.

Some of the major financing packages approved during the period include the $2.25 billion RESET and ARMOR reform financing package approved in June 2024, $1.57 billion for the HOPE and SPIN programmes in September 2024, and $1.08 billion for education and resilience programmes approved in March 2025.

Analysts say the latest loan request reflects the Federal Government’s continued reliance on concessional multilateral financing to sustain ongoing reforms, support critical infrastructure, and stimulate economic growth amid declining revenues, inflationary pressures, and foreign exchange challenges.

The development also comes days after the Accountant-General of the Federation, Shamseldeen Ogunjimi, warned that Nigeria may reconsider future World Bank financing arrangements if approval and disbursement delays continue beyond six months.

Speaking in Abuja during a meeting with a World Bank delegation led by Mrs Treed Lane, Ogunjimi stressed that Nigeria expects faster processing timelines since the facilities are repayable loans and not grants.

“If approvals take more than six months, the Nigerian Government may no longer honour such arrangements,” he said, according to a statement issued by the Office of the Accountant-General of the Federation.

He further argued that prolonged approval processes could disrupt project implementation schedules, fiscal planning, and broader development objectives, urging the World Bank to accelerate the approval and disbursement of funds tied to Nigeria’s priority projects.

Economists say while multilateral loans generally offer lower interest rates and longer repayment periods compared to commercial borrowing, concerns remain over Nigeria’s rising debt servicing obligations and the sustainability of continuous external borrowing.

FG in Advanced Talks With World Bank for Fresh $1.25bn Loan Facility