Nigeria acquired a total of $2.7 billion in loans from the World Bank during President Bola Tinubu’s administration, raising concerns about the nation’s escalating external debt servicing expenses.
The approved loans include $750 million for the power sector, $500 million for women’s empowerment, $700 million for girls’ education, and $750 million for renewable energy.
Loan Details:
1. Power Sector ($750 million):
Approved on June 9, 2023, this loan aims to boost Nigeria’s power sector through additional financing for the power sector recovery performance-based operation.
2. Women’s Empowerment ($500 million):
On June 27, the World Bank approved a $500 million loan to support women’s empowerment in Nigeria, providing scale-up financing for the Nigeria for Women Programme.
3. Girls’ Education ($700 million):
In September 2023, a $700 million loan was approved to enhance educational opportunities and empowerment for adolescent girls through the ‘Adolescent Girls Initiative for Learning and Empowerment’ (AGILE) project.
4. Renewable Energy ($750 million):
Approved on December 14, the World Bank granted a $750 million loan for the Distributed Access through Renewable Energy Scale-up (DARES) project, aiming to improve electricity access for over 17.5 million Nigerians through distributed renewable energy solutions.
Additional Insights:
– Nigeria was the top recipient of World Bank loans in 2022, receiving $2.9 billion, followed by Tanzania with $2.7 billion.
– As of September 30, 2023, Nigeria’s total debt owed to the World Bank is $14.58 billion.
– Concerns have arisen due to the significant increase (277.64%) in Nigeria’s spending on external debt servicing in Q3 2023.
– The World Bank highlighted the impact of high debt service costs on developing countries, emphasizing the need for coordinated action to prevent a potential crisis.
