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World Bank Board to Meet on Nigeria’s $1.5 Billion Loan Request On August 6

The board of the World Bank is expected to meet on August 6, to decide on Nigeria’s request for $1.5 billion facilities to augment its revised 2020 budget amidst the impact of corona virus pandemic, sources at the international lender said.

Mrs Zainab Ahmed, Minister of Finance

The lender decision which was initially set for late July, according to the sources was shifted to August to allow the World Bank board to decide on requests from other countries seeking similar financial accommodation.

The Nigeria country director of the World Bank, Shubham Chaudhuri had told a news agency in May that the country’s request for facilities will be presented to the board in late July. “We were hoping to present to our board by late July or latest early August because the government will need the finance,” Chaudhuri told a news agency in May.

Nigeria had in May secure a $3.4 billion facilities from the International Monetary Fund (IMF) in emergency financial assistance under the Rapid Financing Instrument. World Bank loans usually come with certain conditions attached, which the debtor must be committed to attaining before it could be granted.

The World Bank and its counterpart the IMF had since last year being demanding that Nigeria should reform its exchange rate, sustain fiscal discipline and do away with subsidy on both petroleum products and electricity as part of major reforms recommended to stimulate growth.
It is not clear if Nigeria has signed an undertaking to embark on most of the recommendations of the World Bank and IMF on economic reforms.

Last month, Nigeria seized the opportunity of the sharp drop in the global crude oil prices to abolish subsidy on refined fuel, which for long has been laced with huge corruption and drained resources that should have been invested in social infrastructure.

The Central Bank of Nigeria (CBN) this week said it is making move to unify the multiple exchange rate, which has been on the table of demand by the two world financial institutions. A unified exchange rate and a more flexible exchange rate, according to the World Bank would help the country’s recovery programme and boost investor confidence.

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