Nigeria’s borrowing from the World Bank has increased by 121.46 percent under President Muhammadu Buhari’s leadership.
According to information obtained by Objectv Media, Nigeria’s overall debt to the World Bank Group increased by $7.64 billion (or N3.52 trillion, using the Central Bank of Nigeria’s exchange rate, which was N460.53 per dollar as of April 23, 2023) over the course of seven years.
In particular, figures from the external debt stock reports by the Debt Management Office show that the country’s debt to the Washington, DC-based lender increased from $6.29 billion (N2.9 trillion) as of December 2015 to $13.93 billion (N6.42 trillion) as of December 2022.
The International Development Association and the International Bank for Reconstruction and Development, which make up the World Bank, have over the years advanced loans to Nigeria.
While the IDA offers grants and concessionary loans to governments of the world’s poorest nations, the IBRD lends to governments of middle-income and creditworthy low-income nations.
According to the data, Nigeria owes $6.29 billion to IDA and $3.57 billion to IBRD as of 2016, but by 2022, IDA’s debt to Nigeria would be $13.45 billion and IBRD’s would be $487.03 million.
Further analysis over the years revealed that Nigeria borrowed a total of $6.67 billion from the World Bank in 2016, $8.03 billion in 2017, $8.67 billion in 2018, $10.1 billion in 2019, $11.53 billion in 2020, and $12.38 billion in 2021.
The World Bank often links the loans it approves to Nigeria to several projects spread around the nation.
For instance, it was decided to co-finance the Nigeria Rural Access and Agricultural Marketing Project in 2020 with $280 million from the International Development Association (IDA), $230 million from the French Development Agency, and $65 million from the Federal Government of Nigeria. The project aims to upgrade rural roads, improve connectivity and access to local markets and agribusiness services in 13 states.
The Nigeria Digital Identification for Development Project, which will support the National Identity Management Commission to increase the number of persons who have a national identification number to about 150 million in the next three years, was also approved to be co-financed through an IDA credit of $115m, $100m from the French Development Agency, and $215m from the European Investment Bank.
In 2021, the World Bank approved a $700m credit from the IDA for the Nigeria Agro-Climatic Resilience in Semi-Arid Landscapes Project.
The bank also approved $500m to help boost access to electricity in Nigeria and improve the performance of the electricity distribution companies in the country.
The Punch recently reported that rising debt pushed Nigeria up the World Bank’s top 10 International Development Association borrowers’ list.
The World Bank Fiscal Year 2021 audited financial statements, known as the IDA financial statement, showed that Nigeria was rated fifth on the list with $11.7bn IDA debt stock as of June 30, 2021.
However, the newly released World Bank Fiscal Year 2022 audited financial statements for IDA showed that Nigeria has moved to the fourth position on the list, with $13bn IDA debt stock as of June 30, 2022.
This shows that Nigeria accumulated about $1.3bn IDA debt within a fiscal year, with the country taking over the fourth top debtor position from Vietnam.
This debt differs from the outstanding loan from the World Bank’s International Bank for Reconstruction and Development.
The top five countries on the list slightly reduced their IDA debt stock, except for Nigeria.
The World Bank disclosed recently that Nigeria’s debt, which may be considered sustainable for now, is vulnerable and costly.
The bank said, “Nigeria’s debt remains sustainable, albeit vulnerable and costly, especially due to large and growing financing from the Central Bank of Nigeria.”
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