The World Bank is currently reviewing the federal government’s application for a $2.25 billion loan, which the government asserts will provide vital support to Nigeria’s economic recovery efforts amid persistent fiscal deficits and supply chain challenges.
Minister of Finance and Coordinating Minister of the Economy, Wale Edun, disclosed this in a statement issued by Mohammed Manga, the Director of Information in the Ministry. Although the loan application comprises $1.5 billion in Development Policy Financing and $750 million in Programme-for-Results Financing, the finance ministry expressed optimism about the possibility of approval and subsequent disbursement by June.
“We anticipate the World Bank’s Board to convene in June 2024 to finalize approval for this financial package,” Mr. Edun stated, emphasizing the loan’s terms, which he described as akin to a grant, featuring a 40-year repayment period, 10 years moratorium, and approximately one percent interest. Additionally, the government anticipates a boost to the nation’s foreign reserves through the loan.
Edun reiterated the government’s unwavering commitment to economic stability while outlining key initiatives targeting agriculture, manufacturing, and electricity to stabilize prices, ensure food security, and reduce import dependency. He highlighted the Central Bank’s inflation targeting policies, expected to lead to a potential reduction in interest rates by the second half of the year.
Efforts in the housing sector, according to the minister, aim to foster sustainable value chains, anticipated to catalyze economic growth and enhance housing accessibility. The National Social Investment Programme (NSIP) underwent a recent review to enhance targeted delivery and efficiency, with direct transfers recommencing to support vulnerable populations.
At the World Bank and IMF Spring Meetings, Edun expressed confidence in Nigeria’s future, citing ongoing adjustments and the resilient spirit of its citizens. Permanent Secretary of the Federal Ministry of Finance, Mrs. Lydia Shehu Jafiya, reiterated the ministry’s commitment to aligning its actions with the administration’s policy thrust to effectively execute initiatives and achieve their goals.