Nigerian government seeks new $1.25bn loan from World Bank
Nigerian government seeks new $1.25bn loan from World Bank
The Federal Government has stepped up engagement with the World Bank for a fresh $1.25bn loan to support economic reforms, job creation, and competitiveness.
According to Channels, this was contained in a document titled ‘Nigeria Actions for Investment and Jobs Acceleration.’
According to the document, talks are at the critical stage for the loan facility expected to be presented for approval on June 26, 2026. The loan has progressed beyond the initial concept and appraisal phases.
If approved, it will come off as the second-largest loan facility after the approval of the ‘$1.5bn Reforms for Economic Stabilisation to Enable Transformation Development Policy Financing’ approved by the Bank in June 2024.
The borrower is listed as the Federal Republic of Nigeria, while the Federal Ministry of Finance will serve as the implementing agency.
Nigeria’s external debt as of December 31, 2025, stood at $51.86bn, while its total public debt is currently at $110.97bn.
The loan is now at the decision-meeting stage of the World Bank’s project cycle, a point at which the lender’s management reviews the final appraisal package and determines whether the project should proceed to the Board of Executive Directors for approval.
This stage comes after appraisal and negotiations have been concluded, with key policy actions, financing terms, and reform commitments already agreed in principle between the borrower and the World Bank team.
In the World Bank process, the decision meeting represents a near-final internal clearance, after which the project is prepared for formal Board consideration, where final approval is granted.
The World Bank document stated, “The review did authorise the team to appraise and negotiate,” meaning the project has successfully passed earlier internal checks and is advancing toward final approval.
According to the World Bank, 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.”
The World Bank has approved about $9.35bn in loans and credits for Nigeria between June 2023 and May 2026.
These approvals span multiple sectors, including power, education, healthcare, agriculture, social protection, renewable energy, MSME financing, and economic reform support.
Key packages 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.
The development comes days after the Accountant-General of the Federation, Dr Shamseldeen Ogunjimi, warned that Nigeria may reject loan facilities from the World Bank if delays in approval and disbursement persist for more than six months.
A press statement last week by the Director of Press and Public Relations at the Office of the Accountant-General of the Federation, Bawa Mokwa, stated that Ogunjimi, who spoke in Abuja during a courtesy visit by a World Bank delegation led by Mrs Treed Lane, stressed that Nigeria expects timely processing of funding requests, given that the facilities are loans and not grants.
He said, “If approvals take more than six months, the Nigerian Government may no longer honour such arrangements,” highlighting concerns over bureaucratic delays in accessing development financing.
The AGF noted that as a responsible borrower, Nigeria should not be subjected to prolonged approval processes that could affect project execution timelines and broader development objectives. He therefore urged the World Bank to “expedite the approval and disbursement of project funds to Nigeria” to support the country’s priorities.
