The recent development aligns with President Bola Tinubu's formal request to the National Assembly seeking approval for a $2.209 billion (N1.767 trillion) loan. This loan forms an integral part of the external borrowing strategy designed to facilitate the effective implementation of the N28.7 trillion budget allocated for the year 2024. President Tinubu presented his request through separate letters during the plenary sessions of both the Senate and the House of Representatives.
The IDA offers concessional loans and grants to the governments of the world's poorest nations, serving as a complement to the World Bank's primary lending institution, the International Bank for Reconstruction and Development (IBRD).
According to its financial report for the fiscal year ending September 30, 2024, Nigeria's debt to the IDA rose by $600 million from June to September 2024, marking a significant increase from $16.5 billion to $17.1 billion. This positions Nigeria as the third-largest debtor to the IDA.
On a year-over-year basis, Nigeria's debt exposure to the IDA grew by 14.4%, increasing from $14.3 billion in June 2023 to June 2024. Data from the Debt Management Office (DMO) as of March 31, 2024, indicated that Nigeria's total indebtedness to the World Bank stood at $15.59 billion.
With the current debt level of $17.1 billion, Nigeria ranks as the third-largest debtor to the IDA, following Bangladesh and Pakistan, which owe $21 billion and $18.5 billion, respectively.
The latest financial report reveals that the top ten debtor countries represent 63 percent of the International Development Association's (IDA) total exposure. India is positioned fourth with a debt of $15.9 billion, while Ethiopia follows closely with $13.1 billion.
Among the other significant borrowers in this group are Kenya, which has a debt of $12.4 billion, Tanzania at $12.2 billion, and Vietnam also at $12.2 billion.
At the lower end of the spectrum, Ghana and Uganda owe $7 billion and $5 billion, respectively.
In 2024, the World Bank Group has made substantial contributions by providing essential financing, conducting research, and collaborating with governments, the private sector, and various institutions to tackle global development issues.
The report highlights that the World Bank Group achieved a record $42.6 billion in climate finance during the fiscal year 2024, aimed at eradicating poverty while ensuring a sustainable planet. This funding supports investments in cleaner energy, resilient communities, and robust economies, marking a 10 percent increase in climate financing compared to 2023.
The World Bank Group has pledged to allocate 45 percent of its annual financing to climate initiatives by 2025, with equal distribution between mitigation and adaptation efforts.
In total, it has provided $117.5 billion in loans, grants, equity investments, and guarantees to partner nations and private enterprises. This figure encompasses multi-regional and global operations, with the Bank noting that the regional totals reflect the International Finance Corporation’s (IFC) commitments, which have been adjusted to align with the World Bank’s regional classifications by aggregating commitments at the country level within each region.
Africa received $38 billion, with $12.5 billion allocated to East Asia and the Pacific, $24.7 billion to Europe and Central Asia, $19.4 billion to Latin America and the Caribbean, $6.5 billion to the Middle East and North Africa, and $15.9 billion to South Asia, while $0.4 billion was distributed globally.
President Bola Tinubu has formally requested the National Assembly's approval for an external loan of $2.209 billion (approximately N1.767 trillion), which is already included in the 2024 Appropriation Act.
This request was presented in separate letters during the plenary sessions of both the Senate and the House of Representatives. Tinubu indicated that, if granted, the loan would help address a budget deficit of N9.7 trillion for the upcoming fiscal year.
During the House session, Speaker Hon. Tajudeen Abbas read the letters aloud. In the Senate, following the reading, Akpabio instructed the Senate Committee on Local and Foreign Debts to review the request and provide feedback within 24 hours.
“The presidential request for a loan of $2.2 billion, equivalent to N1.767 trillion, is already part of the external borrowing plan for the 2024 fiscal year. The Senate Committee on Local and Foreign Debts should therefore prioritize this request and report back promptly.”
Additionally, the president submitted the Medium Term Expenditure Framework (MTEF) and Fiscal Strategy Paper (FSP) for the years 2025 to 2027 to both chambers of the National Assembly.
After the letter was read, Akpabio tasked the Senate Committee on Finance, National Planning, and Economic Affairs with reviewing the documents and reporting back within one week.
Key elements in the proposed MTEF/FSP for 2025-2027, which are essential for the approval of the projected N47.9 trillion budget for 2025, include a $75 oil price benchmark per barrel, a daily oil production target of 2.06 million barrels, an exchange rate of N1,400 to $1, and a targeted GDP growth rate of 6.4 percent.
In a recent communication to both chambers of the National Assembly, Tinubu requested approval for the Social Investment Programme Amendment Bill. This proposed amendment is designed to enhance the framework for executing the government's social welfare initiatives, promoting increased transparency and efficiency.
He elaborated that the amendment intends to establish the National Investment Register as the key mechanism for identifying beneficiaries of social investment programs.
According to him, this approach will ensure that welfare initiatives are informed by data, thereby providing effective social protection for Nigeria's most vulnerable populations.
“The amendment will enhance the transparency, efficiency, and effectiveness of our social and welfare programs in meeting the needs of vulnerable Nigerians,” he stated.
He also emphasized that this request aligns with Section 58(2) of the 1999 Constitution (as amended) and urged the Senate to prioritize the bill for immediate consideration.
If enacted, the proposed amendment is expected to improve the management and execution of social investment programs, thereby strengthening their ability to address poverty and inequality throughout the nation.
The Senate has assigned the bill to the appropriate committees for evaluation and is anticipated to discuss the proposal in upcoming sessions.
This development reflects Tinubu's administration's commitment to utilizing technology and data to enhance the effectiveness of its social welfare programs.