The Federal Government has intensified engagement with the World Bank for a fresh $1.25bn loan intended to support economic reforms, job creation, and competitiveness. Findings indicate that the facility, titled Nigeria Actions for Investment and Jobs Acceleration, has reached a critical stage in the approval process of the lender. According to a revised timetable, the proposed loan is expected to be presented for approval on June 26, 2026, which is approximately six months before the 2027 presidential election. If approved, the loan will rank as the second largest single World Bank facility secured under President Bola Tinubu, following a $1.5bn package approved in June 2024.
At an exchange rate of N1,361.4 to the dollar, the proposed $1.25bn facility translates to about N1.70tn. This scale of external financing would raise the external debt of Nigeria from N74.43tn to at least N76.13tn. Details of the facility were contained in a World Bank Programme Information Document which showed that the operation is now at the decision meeting stage of the project cycle. This stage represents a near final internal clearance where management reviews the final appraisal package. The document stated, “The review did authorise the team to appraise and negotiate,” indicating that key policy actions and financing terms have already been agreed in principle.
The Federal Ministry of Finance will serve as the implementing agency for the loan. The World Bank stated the facility is designed “to support the government’s efforts to expand access to finance, digital, and electricity services, and strengthen competitiveness through tax, trade, and agriculture reforms.” Total World Bank approvals under the current administration have reached about $9.35bn between June 2023 and May 2026. If the latest facility is approved, the total will rise to approximately $10.6bn, reinforcing the role of the bank as a major external financier for the reform agenda of the country.
However, the Accountant General of the Federation, Dr Shamseldeen Ogunjimi, has warned that Nigeria may reject loan facilities if delays in approval and disbursement persist. Speaking in Abuja during a visit by a World Bank delegation, Ogunjimi said, “If approvals take more than six months, the Nigerian Government may no longer honour such arrangements.” He stressed that the country expects timely processing given that the facilities are loans and not grants. He noted that as a responsible borrower, Nigeria should not be subjected to prolonged processes that could affect development objectives.
Analysis of debt data shows that the debt of Nigeria to the World Bank rose by $2.08bn in one year to $19.89bn as of the end of 2025. This accounts for 38.36 per cent of the total external debt stock of the country. While the loan is expected to drive growth, the World Bank warned that the operation carries significant risks. The bank stated, “Overall, the risk to this DPF is assessed as high. Political and governance risks are elevated ahead of the 2027 elections, with pressures that could delay or reverse sensitive reforms.” Implementation will be coordinated by the Finance Ministry working with agencies including the Central Bank of Nigeria and the Ministry of Power.
Economists have expressed mixed views on the rising loan pipeline. Lagos based economist Adewale Abimbola noted that loans from multilateral institutions are largely concessionary with interest rates below market levels. Abimbola stated, “If it’s concessionary and tied to viable projects with medium-term revenue prospects, I don’t think it’s a bad idea,” and added that, “Borrowing isn’t bad; what matters is utilisation.” In contrast, the CEO of CSA Advisory, Dr Aliyu Ilias, questioned the rationale for taking on more debt when the government has reported higher revenues following the removal of the fuel subsidy.
The CEO of the Centre for the Promotion of Private Enterprise, Dr Muda Yusuf, emphasised that borrowing should be backed by sound economic reasoning. Yusuf warned that Nigeria should be cautious with foreign loans due to exchange rate risks and stated that a disciplined approach to debt sustainability is crucial. Furthermore, the Nigerian Economic Summit Group warned in its Debt Burden Monitor report that the debt outlook remains fragile. The group noted that while some indicators suggest stabilisation, the improvement is driven by temporary moderation in debt service pressures. The report stated, “This pattern indicates that debt pressure has not structurally eased but instead fluctuates within a high-stress band.”
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