Breaking: Nigeria close to securing $3 billion World Bank facility
- 23rd June 2020
- Posted by: Hakeem
- Category: Economics, International
Nigeria is close to securing a loan of $1.5 billion and another $1-1.5 billion for the Federal Government and states respectively. The fund is being sourced from the World Bank, this is according to information from Nigeria’s Minister of Finance Zainab Ahmed.
She said this in a Citi Bank Investor update call with the Federal Government of Nigeria and organized by Citi Bank. Nairametrics listened in on the call.
The update titled “Covid-19 Economic and Budgetary Update” had the following representing Nigeria on the panel;
- Mrs. Zainab S. Ahmed – Finance Minister
- Mr. Godwin Emefiele – CBN Governor
- Ms. Patience Oniha – DG DMO
- Mr. Ben Akabueze – DG Budget Office
- And a representative of the Hon. Minister of Health.
According to Mrs. Zainab Ahmed negotiations with the World Bank “is on course” for a $1.5 billion facility for the Federal Government and another $1-1.5 billion for State Governments.
According to Zainab “World Bank Negotiations is on course and we are looking at world bank going to the board on 6th of August for Nigeria’s approval. They have met largely all the conditions for the facility.
She also confirmed the amount Nigeria is looking to raise from the World Bank. “The amount we are raising in the first instance is $1.5 billion for FG and around September October we are hoping to close out on the facility meant for states and the amount is meant to be $1-1.5 billion.”
Nairametrics reported last week that the Government was planning to inject a bailout of N2.3 trillion into the economy which it hopes to source from three sources. This is part of the government efforts to combat the effects of Covid-19 on the economy. Firstly, it claims it will raise N500 billion from Special Accounts. Special Accounts are government accounts approved by the National Assembly where monies are accrued from tax deductions, oil proceeds, or any other source as provided in the law. Examples are the Ecological Funds, Education Trust Fund, Universal Basic Education Fund, etc.
Secondly, it proposes to raise about N1.1 trillion from what it termed “CBN Structured Lending” which suggests more intervention loans from the CBN. It could also include restructuring existing intervention loans by offering moratorium and lower interest rates which were also captured in the report.
The balance of N334 billion and N302.9 billion respectively will come from “external bilateral/multilateral sources – N334billion and other funding sources – N302.9bn.” These are basically loans and grants from monetary development institutions and rich donor countries.
The $3 billion facilities for both the states and FG is likely the balance funds required to complete the stimulus facility.