Nigeria’s government released a statement after the IMF/World Bank spring meetings in Washington, D.C., stating that the country is requesting up to $2.25 billion in loans from the World Bank and anticipates that the bank’s board will approve the request in June.
According to the announcement released by Finance Minister Wale Edun, Nigeria also plans to issue diaspora bonds later this year in an effort to bring much-needed foreign exchange into the nation.
In a bid to address economic challenges exacerbated by a shortage of foreign exchange and record debt, Nigeria is seeking loans totaling $2.25 billion from the World Bank. The loan package comprises $1.5 billion in development policy financing and $750 million in programme-for-results financing, according to a statement released by the government.
The statement indicated that the World Bank would convene in June to deliberate on final approval of the loan package. However, immediate comment from the World Bank on the statement was not available.
Nigeria, known as Africa’s largest oil exporter, has been grappling with a shortage of foreign exchange, leading to a significant depreciation of its currency, the naira, against the U.S. dollar. Although the naira has experienced a rebound, the economic challenges persist.
President Bola Tinubu has inherited an economy burdened by record debt, high unemployment rates, and substantial central bank financing. However, according to remarks made by an official last week, the government claims to have made efforts to mitigate the situation, stating that federal borrowing from the central bank has been halved.
The proposed loans from the World Bank represent a significant step for Nigeria as it strives to stabilize its economy and address key financial issues. With the June meeting looming for final approval, stakeholders will be closely watching the outcome and the potential impact on Nigeria’s economic landscape.
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