Federal Government In Talks With World Bank For Fresh $1.25 Billion Loan
The Federal Government is currently in discussions with the World Bank over a proposed $1.25 billion loan facility aimed at supporting ongoing economic reforms, job creation, and competitiveness initiatives.
According to a document obtained by Channels Television and titled Nigeria Actions for Investment and Jobs Acceleration, the loan is expected to finance reforms in key sectors, including access to finance, digital infrastructure, electricity services, taxation, trade, and agriculture.
The document indicated that negotiations have reached an advanced stage, with the proposed facility scheduled for consideration and possible approval on June 26, 2026. The loan has already progressed beyond the concept and appraisal phases of the World Bank’s project cycle.
If approved, the facility would become Nigeria’s second-largest recent World Bank loan, following the $1.5 billion Reforms for Economic Stabilisation to Enable Transformation Development Policy Financing approved in June 2024.
The Federal Republic of Nigeria is listed as the borrower, while the Federal Ministry of Finance will serve as the implementing agency.
Nigeria’s external debt stood at $51.86 billion as of December 31, 2025, while the country’s total public debt has risen to $110.97 billion.
The proposed loan is currently at the decision-meeting stage of the World Bank approval process. At this phase, the bank’s management reviews the final appraisal package and determines whether the project should proceed to the Board of Executive Directors for final approval.
This stage follows the completion of appraisal and negotiations, during which financing terms, policy reforms, and implementation commitments are agreed upon in principle between Nigeria and the World Bank team.
According to the document, “The review did authorise the team to appraise and negotiate,” indicating that the project has successfully passed key internal assessments and is nearing final consideration.
The World Bank stated that the loan is intended “to support the government’s efforts to expand access to finance, digital, and electricity services, and strengthen competitiveness through tax, trade, and agriculture reforms.”
Between June 2023 and May 2026, the World Bank approved approximately $9.35 billion in loans and credits for Nigeria across sectors such as power, education, healthcare, agriculture, renewable energy, social protection, MSME financing, and economic reforms.
Major approvals during the period include the $2.25 billion RESET and ARMOR reform financing approved in June 2024, the $1.57 billion HOPE and SPIN programmes approved in September 2024, and the $1.08 billion education and resilience package approved in March 2025.
The development comes just days after the Accountant-General of the Federation, Shamseldeen Ogunjimi, warned that Nigeria may reject World Bank loan facilities if approval and disbursement delays extend beyond six months.
Speaking during a courtesy visit by a World Bank delegation led by Mrs Treed Lane in Abuja, Ogunjimi stressed the need for timely processing of loan requests, noting that the facilities are repayable loans and not grants.
“If approvals take more than six months, the Nigerian Government may no longer honour such arrangements,” he said, citing concerns over bureaucratic delays affecting project execution and development targets.
He further urged the World Bank to accelerate approval and disbursement processes to align with Nigeria’s fiscal planning and implementation timelines.
Source: Channels