World Bank Approves $1.25bn Nigeria Loan Amid Growing Debt Concerns and Economic Reform Push

The World Bank has approved a fresh $1.25 billion loan for Nigeria under its Nigeria Actions for Investment and Jobs Acceleration (NAIJA) programme, a move that has reignited public debate over the country’s increasing debt burden. The approval comes despite widespread concerns from Nigerians who have questioned whether years of external borrowing have translated into meaningful improvements in living standards, job opportunities, and economic stability.

The funding was announced alongside the World Bank’s new Country Partnership Framework for Nigeria, covering the period from 2026 to 2032. According to the institution, the six-year strategy is designed to unlock private sector-led growth, stimulate job creation, and strengthen key sectors of the economy. The bank believes recent macroeconomic reforms introduced by the Federal Government have helped improve investor confidence, boost government revenues, and strengthen Nigeria’s external reserves.

Under the new framework, millions of Nigerians are expected to benefit from investments in critical sectors. The World Bank plans to support expanded electricity access for 32 million people, provide broadband connectivity to 58 million citizens, improve health and nutrition services for 40 million Nigerians, and assist about 9.5 million farmers. The initiative also targets stronger agricultural productivity, improved digital infrastructure, and enhanced human capital development to drive long-term economic growth.

World Bank Country Director for Nigeria, Mathew Verghis, said the institution’s priority is to help Nigeria convert recent economic gains into tangible improvements in the lives of ordinary citizens. He noted that while economic reforms have contributed to stabilising the economy, addressing long-standing structural challenges remains essential for attracting investment and creating sustainable jobs. Other World Bank officials echoed similar sentiments, highlighting Nigeria’s vast growth potential while acknowledging the risks that continue to concern investors.

However, the latest loan approval has once again drawn attention to Nigeria’s rising debt profile. Data from the Debt Management Office shows that Nigeria’s debt to the World Bank increased from $17.81 billion at the end of 2024 to $19.89 billion by December 2025, making the institution the country’s largest external creditor. With the World Bank now accounting for more than 38 percent of Nigeria’s total external debt stock, critics argue that stronger accountability and measurable economic outcomes must accompany future borrowing. Supporters, on the other hand, insist that if properly implemented, the new facility could help accelerate reforms, attract private investment, and create much-needed jobs across the country.

source: punch