The Federal government is about to secure another $1.5 billion loan from the World Bank, despite mounting debt pressure on the country.
The new $1.5 billion loan, according to the Minister of Finance and Coordinating Minister of the Economy, Wale Edun, “which has been in pipeline for a while,” will soon be released.
According to Edun, given the prevailing high interest rate regime across the world, the Federal government will focus on initiatives for financing on reasonable terms.
The minister said: “On the talks with the World Bank on $1.5 billion budget support, that is correct. The World Bank is the number one multilateral development bank helping developing countries or funding developing countries, projects and programmes, and sectors.
“It has free money through either International Development Association (IDA). It is for the poorer countries and right now I think we qualify as one of the countries that can borrow in the normal window of World Bank funding but also some concessionary IDA funding and that means that effectively the interest rate will be zero.
“So, therefore, there is no stigma attached to qualifying for World Bank funding to help finance development. In this particular case, it has long been in the pipeline, and we are hoping that funding will come through soon. A lot of hard work is being done. There is a Federal Executive Council meeting on Monday, that should be able to discuss this, as well as other initiatives for financing on reasonable terms. We have talked about the high costs of money, the World Bank money is the cheapest”.
The development is coming at a time the 2022 audited financial statement of the World Bank showed Nigeria ranks fourth on the list of borrowers from its International Development Association (IDA) with $14.3 billion debt.
Nigeria is also the highest debtor to the IDA in Africa.