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By Uche Usim
Nigeria has again approached the World Bank for a new $1 billion loan under a programme designed to boost private investment, job creation and economic diversification.
The facility, tagged Nigeria Actions for Investment and Jobs Acceleration (P512892), is part of the global Bank’s Development Policy Financing (DPF) framework and is expected to be presented for board consideration on December 16, 2025.
The request has sent tongues wagging as analysts worry the country might be boxed into a debt trap if strategic repayment frameworks are not in place.
As of June 2025, Nigeria’s external debt stood at $46.98 billion, with the World Bank Group accounting for $19.39 billion, about 41.3 per cent of the nation’s total debt stock, accentuating its role as Nigeria’s largest creditor.
The loan negotiations, according to a concept note obtained by Nairametrics, comprises $500 million in International Development Association (IDA) credit and $500 million from the International Bank for Reconstruction and Development (IBRD).
If approved, it would represent Nigeria’s second-largest loan under President Bola Tinubu, following the $1.5 billion RESET initiative secured in June 2024.
In a statement, the World Bank said the new operation aims to transition Nigeria “from short-term macroeconomic stabilisation to sustainable, private-sector-led growth.” It added that the programme targets reforms to expand access to credit, strengthen digital financial systems, and boost productivity in key agricultural value chains.
“The proposed Development Policy Financing supports Nigeria’s pivot from stabilisation to inclusive growth and job creation,” the document stated, as it outlined goals such as deepening capital markets, easing inflationary pressures and promoting export diversification.
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To enhance domestic financial resilience, the loan will back the implementation of the Investment and Securities Act 2025, operationalisation of credit-enhancement facilities, and a new Central Bank of Nigeria rulebook to improve consumer protection and risk-based regulation.
Digital transformation is a key pillar of the plan. It includes support for the National Digital Economy and E-Governance Bill 2025, which seeks to formalise electronic transactions, authentication services, and data governance.
Beyond the financial sector, the World Bank advised Nigeria to reduce production and living costs by reforming its restrictive trade regime.
The recommendations include AfCFTA tariff concessions, simplified import procedures, and streamlined certification for strategic crops like maize, rice, and soybeans, reforms expected to cut food inflation and enhance export competitiveness.
The $1 billion operation will run in tandem with three complementary World Bank programmes, FINCLUDE, BRIDGE, and AGROW, which focus on inclusive finance, digital infrastructure, and sustainable agriculture respectively.
The Bank projects that these reforms will create more jobs, lower living costs, and expand credit access for micro, small, and medium enterprises (MSMEs). Improved agricultural productivity, it added, will also raise rural incomes and strengthen food security.
The report praised Nigeria’s ongoing reforms, including fuel subsidy removal, forex unification, and improved revenue administration, noting that these have helped stabilise the economy and rebuild investor confidence.
Despite progress, Nigeria’s growth remains modest, with per-capita income below pre-2015 levels and over 130 million people still living in poverty. The new World Bank facility aims to bridge this gap by unlocking private-sector-driven, inclusive development.
