AfDB Approves $500m Loan to Boost Nigeria’s Energy Reforms and Fiscal Stability
The African Development Bank has approved a fresh $500 million loan to support Nigeria’s ongoing economic governance and energy transition reforms, marking a major step toward stabilising public finances and improving electricity access for millions of citizens. Announced in Abidjan, the funding forms the second phase of the Economic Governance and Energy Transition Support Programme, covering Nigeria’s fiscal years 2024 and 2025.
According to the AfDB’s Communication and External Relations Department, the programme is designed to strengthen Nigeria’s fiscal foundation by enhancing transparency, tightening public financial management systems, and improving the efficiency of government spending. The bank says these reforms are essential to reducing financial leakages, boosting non-oil revenues, and expanding the country’s fiscal space at a time of economic strain.
A key component of the $500m package focuses on accelerating long-delayed energy sector reforms. The initiative aims to curb energy poverty, upgrade power infrastructure, and improve governance in the electricity supply industry, thereby attracting greater private investment. By expanding access to reliable electricity, the programme seeks to create opportunities for businesses and households whose daily activities are often hindered by power shortages.
The loan will also support Nigeria’s broader climate commitments by advancing its energy transition agenda. This includes updating the country’s Nationally Determined Contribution for 2026–2030, strengthening climate-change adaptation and mitigation efforts, and introducing nationwide energy-efficiency standards for electrical appliances. The AfDB says these measures will help align Nigeria’s climate goals with global targets while reducing long-term environmental risks.
Speaking on the approval, AfDB Nigeria Country Director Abdul Kamara said the second phase of the programme will consolidate the gains of the first and accelerate structural reforms needed for inclusive growth. Beneficiaries span key federal agencies—including the Ministries of Power, Finance, and Environment, the FIRS, the NERC, and the National Climate Change Council—while private sector players are expected to benefit from a more enabling investment climate. As of October 2025, the AfDB had committed $5.1 billion to 52 active projects in Nigeria, underscoring its continued support for economic stability, energy transition, and sustainable development across the country.
source: Punch