Nigeria is eagerly awaiting the final approval of a $2.25 billion World Bank loan scheduled for June 2024. This significant financial aid package consists of two components: a $1.5 billion loan in Development Policy Financing and an additional $750 million in Programme-for-Results Financing.
The Ministry of Finance disclosed these details in a statement released on Monday, with Mohammed Manga, the director of information and public relations, as the signatory. Wale Edun, Nigeria’s Minister of Finance and coordinating minister for the economy, shared the news during a weekend announcement in Washington. He referred to the World Bank loan as a “free lunch,” highlighting it as one of Nigeria’s key outcomes from the recently concluded 2024 spring meetings of the World Bank and International Monetary Fund (IMF).
Edun stated, “We expect that the Board of the World Bank will meet in June 2024 to consider the final approval of this financing package.” However, he revealed during a press conference at the spring meetings that the World Bank’s board of directors had already granted approval for the credit, which is currently undergoing processing.
This financial facility offers favorable terms, including a 40-year repayment period with a 10-year moratorium and a 1 percent interest rate. Edun emphasized its attractiveness, likening the World Bank loan to “virtually a grant.”
He elaborated, “We have qualified for the processing, just this week to the Board of Directors of the World Bank, of the total package of $2.25 billion of what you can call, I mean if there is no such thing as a free lunch, but it is the closest you can get to free money. It is virtually a grant. It is for about 40 years, 10 years moratorium and about 1% interest. So that also is part of the flow you can count.”
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During the Spring Meetings, Edun, leading the Nigerian delegation, highlighted the nation’s economic resilience and strategic responses to global challenges. This World Bank loan is anticipated to provide significant support to Nigeria’s ongoing efforts in addressing various economic and developmental priorities.
As Nigeria prepares for the final approval of this substantial World Bank loan package, attention is directed towards how the funds will be utilized to bolster the country’s economy, infrastructure, and social welfare programs. With favorable terms and the potential to contribute to long-term growth, the World Bank loan represents a significant opportunity for Nigeria’s economic advancement and resilience amidst evolving global dynamics.