FG in talks with World Bank for fresh $1.25bn loan

The Federal Government is currently negotiating with the World Bank for a new $1.25bn loan facility aimed at financing economic reforms, job creation, and improving Nigeria’s competitiveness, according to a document obtained by Journalists.

The proposed facility, titled Nigeria Actions for Investment and Jobs Acceleration, is said to have reached a critical stage in the World Bank’s approval process and is expected to be presented for board consideration on June 26, 2026.

The document shows that discussions have moved beyond the concept and appraisal phases, indicating that key policy actions, financing terms, and reform commitments have already been agreed in principle between Nigeria and the World Bank team.

If approved, the loan would become the second-largest facility under the current administration, following the $1.5bn Reforms for Economic Stabilisation to Enable Transformation Development Policy Financing approved in June 2024.

The borrower is listed as the Federal Republic of Nigeria, with the Federal Ministry of Finance serving as the implementing agency.

Nigeria’s external debt stood at $51.86bn as of December 31, 2025, while total public debt is currently estimated at $110.97bn. Approval of the new facility is expected to further increase the country’s debt stock.

The loan is now at the decision-meeting stage of the World Bank’s internal cycle, where management reviews the final appraisal package before sending it to the Board of Executive Directors for final approval.

At this stage, the project has already undergone appraisal and negotiations, with only final internal clearance and board approval remaining.

According to the document, the facility is designed to support government efforts to expand access to finance, digital infrastructure, and electricity services, while also strengthening competitiveness through reforms in taxation, trade, and agriculture.

The World Bank has already approved about $9.35bn in loans and credits for Nigeria between June 2023 and May 2026, covering sectors such as power, education, healthcare, agriculture, social protection, and economic reform programmes.

Key recent approvals include $2.25bn for RESET and ARMOR reforms in 2024, $1.57bn for HOPE and SPIN programmes in 2024, and $1.08bn for education and resilience initiatives in 2025.

The development comes amid renewed concerns over Nigeria’s rising debt profile and increasing reliance on external borrowing to sustain economic reforms under the Tinubu administration.

It also follows warnings by the Accountant-General of the Federation, Dr Shamseldeen Ogunjimi, who said Nigeria may reject World Bank loans if approval and disbursement delays exceed six months, arguing that prolonged timelines could disrupt project implementation and national development plans.