The World Bank, Thursday, said it had approved a total of $2.1 billion in concessionary loans to fund projects in Nigeria aimed at improving access to electricity and promoting governance, according to a report by Reuters.
The projects approved by the International Development Association (IDA), the bank’s low-interest arm, are expected to support the country’s economic growth plan.
World Bank said more than half of the loans would be used to fund power and climate change projects and boost fiscal transparency.
The bank also approved a $7 million grant for nutrition. Recall that Nigeria privatised most of its power sector in 2013 but retained control of its dilapidated monopoly transmission grid, often blamed for hobbling growth.
The country intends to raise $2.8 billion of debt offshore to help part-finance its 2018 budget and plans to explore all options to lower costs, the Director General of Debt Management Office (DMO) told Reuters.
The debt office said it could tap capital markets or concessionary loans from the World Bank after the 2018 budget had been approved. Growth rates in Nigeria have bounced back since the third quarter of 2016, when a recession, the first in 25 years, bottomed out.
Growth returned largely due to higher oil prices, with the country relying on crude sales for much of its revenue. However, growth slowed again in the first quarter of 2018, as the country’s non-oil sector struggled. The government expects growth to rise to a pre-recession level of 7 percent by 2020.