W’Bank approves $1.25bn Nigeria loan despite debt concerns

The World Bank has approved a $1.25 billion loan for Nigeria, intended to support its "Nigeria Actions for Investment and Jobs Acceleration" program. This decision comes amid public criticism regarding Nigeria's increasing debt burden and calls for the lender to cease further borrowing.

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The World Bank Group has endorsed a new Country Partnership Framework for Nigeria spanning 2026-2032, setting out a strategy to create more and better jobs at scale by unlocking private sector-led growth.

The new loan is integrated into the World Bank's Country Partnership Framework for Nigeria, which spans from 2026 to 2032. This framework outlines the bank's strategy to foster job creation by stimulating private sector-led growth. The World Bank stated that the program supports Nigeria's shift towards a more inclusive growth model that spurs economic expansion and generates employment.

This approval follows weeks of public backlash on social media, where many Nigerians questioned whether the country's growing external debt had led to improved living standards. The criticism intensified after reports surfaced about the Federal Government's engagement with the World Bank for this specific loan to bolster economic reforms, job creation, and competitiveness.

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The Nigeria Actions for Investment and Jobs Acceleration Development Policy Financing operation, which supports Nigeria’s transition toward a more inclusive growth model that spurs growth and creates jobs.

The Country Partnership Framework is designed to build upon Nigeria's recent macroeconomic reforms, which the bank noted have resulted in stronger economic growth, increased government revenues, higher external reserves, and improved investor confidence. The framework aims to extend electricity access to 32 million Nigerians, provide broadband connectivity to 58 million people, enhance health and nutrition services for 40 million citizens, and support 9.5 million farmers.

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Our new Country Partnership Framework provides the strategy for how the World Bank Group will support Nigeria over the coming years, with a strong focus on helping to create more and better jobs, particularly by enabling private sector-led growth.

Mathew Verghis, World Bank Country Director for Nigeria, emphasized that the institution's strategy will focus on helping Nigeria translate recent macroeconomic gains into tangible improvements in living standards. He stated that addressing structural constraints to spur private sector investment and job creation is crucial for this translation. The $1.25 billion financing will support reforms aimed at strengthening the foundations for growth and competitiveness.

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The recent macroeconomic gains have been critical to help stabilise the economy. Translating improved macroeconomic conditions into better living standards will require addressing the structural constraints to spur private sector investment and job creation.