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World Bank loan to Nigeria rises by $410 million in first quarter 2023
World Bank loans to Nigeria increased by 2.94 per cent or $410 million in the first quarter of 2023, according to data from the global financial institution.
The World Bank disburses loans to developing and underdeveloped nations through the International Bank for Reconstruction and Development (IBRD) and International Development Association (IDA).
Through IBRD and IDA, Nigeria has obtained a $14.34 billion loan as of March 31, 2023, up from $13.93 billion reported by the Debt Management Office (DMO) as of December 31, 2022.
IDA accounts for $13.85 billion, while IBRD has loaned $488.66 million to Nigeria as of the end of the first quarter, March 2023.
Nigeria has depended on the World Bank for loans since 1947, and according to the DMO, the credit attracts low charges and comes with very long tenors.
DMO had stated that the IDA loans help Nigeria reduce debt service costs: “Positive development in the sense that IDA Loans are concessional, that is, they attract low charges and are for very long tenors in some cases, exceeding 30 years. These are the types of Loans required to fund development in countries such as Nigeria.
“By accessing IDA funding, the Government is actively reducing debt service costs, since non-concessional funding is usually more expensive and for shorter tenors. Indeed, it will be inefficient for Nigeria to borrow from commercial sources when concessional funding sources such as IDA is available.”
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