Amidst complaints over mounting debts by the Nigeria government, the World Bank on Thursday, approved a $2.1bn in concessionary loans to fund projects that would improve access to electricity and promote governance in the country.
The projects approved by the International Development Association (IDA), the bank’s low-interest arm, are expected to support Nigeria’s economic growth plan.
The World Bank said more than half of the loans would be used to fund power and climate change projects and boost fiscal transparency. It also approved a $7 million grant for nutrition.
Reuters recalled that Nigeria privatised most of its power sector in 2013 but retained control of its dilapidated monopoly transmission grid, often blamed for hobbling growth.
The country intends to raise $2.8 billion of debt offshore to help part-finance its 2018 budget and plans to explore all options to lower costs, the debt office head told Reuters.
The country’s Debt Management Office (DMO) said it could tap capital markets or concessionary loans from the World Bank after the 2018 budget had been approved.
Last week, the DMO put the country’s debt profile at the end of Q1 2018 at N22.7tr ($74.28bn), a 4.5% rise over the N21.7tr reported at the end of 2017. At the end of 2015, the country’s total debt was N12.6tr.