By Abiodun Folarin
WorldStage– The World Bank has tied the disbursement of a $500 million loan to Nigeria to the implementation of economic reforms, fiscal transparency and independent oversight, placing conditions on the Federal Government’s access to the funds.
The facility is part of the $1.25 billion Nigeria Actions for Investment and Jobs Acceleration (NAIJA) Development Policy Financing programme approved by the lender in June 2026.
Under the loan agreement signed by the Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, on October 6, the $500 million facility will be released in two tranches of $249.375 million each, while $1.25 million is earmarked for the front-end fee.
The financing, provided by the International Bank for Reconstruction and Development (IBRD), a member of the World Bank Group, is designed to support reforms aimed at improving the business environment, boosting public revenue and reducing trade barriers.
The agreement stipulates that the first tranche can only be released after the World Bank is satisfied with the implementation of the programme and the adequacy of Nigeria’s macroeconomic policy framework.
Disbursement of the second tranche is subject to evidence of satisfactory progress and the completion of specified policy actions by the Federal Government.
The lender also reserves the right to cancel all or part of the undisbursed loan if Nigeria fails to implement corrective measures acceptable to it within 90 days of receiving notice of non-compliance with the agreed conditions.
The agreement further requires the Federal Government to maintain a dedicated foreign currency account for the loan proceeds and record the corresponding naira equivalent in its budget management system.
The facility has a closing date of December 31, 2027.
