The Federal Government has begun a process to obtain a fresh $2bn loan from the World Bank.
The loan request submitted by the Ministry of Finance on behalf of the government is currently undergoing concept review, an appraisal stage that will lead to further negotiation and approval.
According to documents posted on the website of the international lender, the government made four loan requests for infrastructural projects.
The proposed loan projects, targeting crucial sectors such as healthcare, agriculture, and infrastructure, are pivotal for the country’s sustainable development and economic stability.
If approved, Nigeria would have amassed $4.25 billion in loans from the bank just this year and a total of $6.95 billion during President Bola Tinubu’s administration.
Recall that each loan project was estimated to receive a net commitment of $500m from the Washington-based lender.
A breakdown showed that the government requested a sum of $500m for a program named; Nigeria Human Capital Opportunities for Prosperity and Equity. It has an approval date of September 17, 2024.
The HOPE project will focus on enhancing human capital by improving education, health, and social protection services.
Similarly, $500m will be earmarked for the Nigeria: Primary Healthcare Provision Strengthening Program, which has an approval date of September 23, 2024.
This program aims to fortify Nigeria’s primary healthcare system by enhancing healthcare infrastructure, training healthcare professionals, and improving service delivery.
The third project, Sustainable Power and Irrigation for Nigeria Project, will also receive $500 million and is scheduled for approval on September 26, 2024, focusing on sustainable power generation and irrigation, both of which are essential for agricultural and industrial development.
Lastly, the Rural Access and Agricultural Marketing Project – Scale Up will receive $500m and is scheduled for approval on November 28, 2024 and it seeks to improve rural infrastructure and market access for agricultural products.
In addition to these four projects, the World Bank has scheduled another loan project for next year. The Solutions for the Internally Displaced and Host Communities Project is set to receive $300 million and is scheduled for approval on April 8, 2025.
While there is a pending request for $500m loans to enhance rural road infrastructure and agricultural marketing across the federation.
It was gathered that the Federal Government had borrowed a total of $4.95bn in loans from the World Bank in the past 12 months under the current administration while it expects another $4.4bn from the international lender and the Africa Development Bank over the next one year.
This was amid concerns over the country’s rising external debt servicing costs.
Among the recently approved are two loan projects aimed at bolstering Nigeria’s economic stability and supporting its vulnerable populations.
According to a statement from the bank, the combined package, totalling $2.25bn, comprises the $1.5bn Nigeria Reforms for Economic Stabilization to Enable Transformation Development Policy Financing Program and the $750m Nigeria Accelerating Resource Mobilization Reforms Program-for-Result.
Data from the external debt stock report of the Debt Management Office shows that Nigeria owes the World Bank a total of $15.59bn as of March 31, 2024. (Punch)
