World Bank to increase funding for Nigeria by $4.5bn

The World Bank said it is making plans to increase its funding to Nigeria by $4.5 billion over the next three years.

The Vice President of the bank for Africa, Hafez Ghanem, in an interview in Abuja said the upward review of its funding to the nation was aimed at supporting projects in the power and health industries and in governance, Bloomberg reported.

“This is indicative – in the next 18 months or so, we expect to put in place projects for around $2.5 billion. We are thinking about financing more investments in power and the area of social protection,” the lender’s vice president for Africa said.

Currently, the Washington-based institution has 30 projects estimated at $10 billion in Nigeria.
He said Nigeria’s non-oil tax collection is presently low and well below the levels of structural and regional peer countries, noting that the country needs to increase its non-oil tax revenue.

“Nigeria needs to increase its non-oil revenue collected at both the federal and state level across the main type of taxes; income, VAT, excises and customs, and states’ internally generated revenues.

“To do that requires strengthening tax administration and increasing compliance rates, and reforms, including rationalising tax incentives and exemptions, and selectively increasing rates such as excise on alcohol and tobacco,” he said.

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Ghanem, who expressed worry over possible delays in the implementation of government programs due to focus on the 2019 general elections, stressed that the elections are unlikely to directly impact growth in 2019.

“We urge the government to remain focused on implementing the Economic Recovery and Growth Plan (ERGP), which includes the power-sector recovery plan,” he added.

Two weeks ago, the International Monetary Fund (IMF) had projected Nigeria’s 2019 Gross Domestic Product (GDP) to hit 2.3 percent from 2.1 percent forecast for 2018 on the back of an improved outlook for oil prices.

The ERGP is a four-year medium term strategic blueprint of the Federal Government covering 2017 to 2020 and focusing on human capital investment, restoration of economic growth, and building a competitive economy.

Last week, the World Bank had approved $2.1 billion loan for seven projects to support Nigeria’s investments in nutrition, access to electricity, states’ fiscal transparency, polio eradication, women’s economic empowerment, public finance and national statistics and reducing vulnerability to soil erosion.

 

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