Amid Rising Debt Profile, FG Seeks Fresh $1.5bn World Bank Loan

By Babajide Okeowo

Amid a ballooning debt profile and revenue generation challenge, Nigeria is seeking a fresh $1.5bn loan from the World Bank to tackle the severe dollar shortage contributing to the decline of the naira and boost the 2024 budget.

Wale Edun, Minister Of Finance and Coordinating Minister of the Economy made this known in an interview with Bloomberg.

“We’re hoping to get $1bn or $1.5bn from the World Bank” for budgetary support, Edun said.

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The minister said the new World Bank loan would be used to finance development, disclosing that the facility would be disbursed to Nigeria very soon.

He said, “On the talks with the World Bank on $1.5bn budget support, that is correct. The World Bank is the number one multilateral development bank helping developing countries or funding developing countries, projects programs, and sectors.

“It has free money through the International Development Association. It is for the poorer countries and right now, I think we qualify as one of the countries that can borrow from the normal window of the World Bank funding, but also some concessionary IDA funding; and that means that effectively, the interest rate will be zero.”

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According to the minister, Africa’s largest economy may also issue a Eurobond in late 2024, adding that with the current economic reforms, the country deserves support.

Eurobonds, denominated in foreign currencies, offer Nigeria a mechanism to navigate its financial landscape amidst challenging economic conditions.