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By Adanna Nnamani, Abuja
The African Development Bank Group (AfDB) has approved a fresh $500 million loan for the Federal Government to finance the second phase of the Economic Governance and Energy Transition Support Programme. The initiative aims to strengthen fiscal policies, advance energy sector reforms, and support Nigeria’s climate action objectives.
The approval was announced on Wednesday in a statement from Alexis Adélé of the Bank’s Communication and External Relations Department.
According to the statement, the loan was endorsed by AfDB’s Board of Directors during a meeting in Abidjan, covering fiscal years 2024 and 2025.
“The Board of Directors of the African Development Bank Group, meeting in Abidjan, approved a $500m loan to the Government of the Federal Republic of Nigeria to finance the second phase of the Economic Governance and Energy Transition Support Programme. The policy-based operation is for fiscal years 2024 and 2025,” the statement said.
The programme is structured around three pillars. The first focuses on strengthening fiscal policy through enhanced public financial management systems and greater transparency and efficiency in government expenditure.
The second pillar aims to drive reforms in the energy sector, with targets including reducing energy poverty, broadening electricity access, improving governance, and attracting private investment to the sector.
The third component supports Nigeria’s energy transition and climate obligations by advancing the National Energy Transition Plan, fostering climate adaptation and mitigation, and establishing energy-efficiency standards for electrical appliances nationwide.
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Commenting on the project’s goals, Abdul Kamara, Director-General of AfDB’s Nigeria Office, said the second phase is designed to promote inclusive growth and consolidate progress made in the first phase.
“The second phase of the programme aims to stimulate inclusive growth by accelerating structural reforms in the energy sector, while supporting progressive reforms of fiscal policy to boost non-oil revenues and expand fiscal space. The new phase will consolidate and build on the achievements of the first phase,” he said.
The programme will also guide Nigeria in updating its Nationally Determined Contribution for the 2026–2030 period, aligning with international climate commitments.
Key beneficiaries include the Federal Ministries of Power, Finance, and Environment, the Federal Inland Revenue Service, the Nigerian Electricity Regulatory Commission, the Debt Management Office, the Office of the Auditor General, and the National Climate Change Council of Nigeria.
According to the Bank, private sector stakeholders will benefit from an improved investment environment and greater opportunities in energy-related ventures nationwide.
As of October 31, 2025, the AfDB’s active Nigeria portfolio comprised 52 projects with a total commitment of $5.1 billion.
The newly approved loan reinforces the Bank’s commitment to supporting Nigeria’s economic reforms, sustainable energy transition, and broader pursuit of an inclusive and resilient economy.
