World Bank Sets Date for Approval of New $1bn Loan to Boost Jobs and Investment in Nigeria

World Bank has set December 16 for the approval of a new $1bn Loan to boost jobs and investment in Nigeria.

NaijaOnPoint Nigeria reports that the World Bank has set December 16, 2025, as the tentative approval date for a new $1 billion Development Policy Financing (DPF) loan to Nigeria under a fresh initiative titled “Nigeria Actions for Investment and Jobs Acceleration (P512892).”

According to a project document released by the Bank on October 27, the facility will comprise a $500 million International Development Association (IDA) credit and a $500 million International Bank for Reconstruction and Development (IBRD) loan.

The funding falls under the Bank’s Macroeconomics, Trade, and Investment practice area for Western and Central Africa, and is designed to support ongoing economic reforms, drive job creation, and accelerate private investment across key sectors.

Strengthening Reforms and Growth

 

The new loan is part of the World Bank’s broader post-reform support package aimed at helping Nigeria transition from short-term stabilisation to sustainable and inclusive growth. It will be implemented through the Federal Ministry of Finance, which has already received authorisation to proceed with loan preparations.

According to the Bank, the DPF “supports Nigeria’s pivot from stabilisation to inclusive growth and job creation.” Structured as a two-tranche standalone operation, it seeks to catalyse private sector–led growth by improving access to credit, deepening capital markets, expanding digital services, reducing inflationary pressures, and diversifying exports.

Focus on Private Investment and Cost Reduction

 

The initiative is built around two main pillars:

1. Unlocking private sector growth by expanding access to finance, promoting digital inclusion, and strengthening financial regulations.

2. Reducing the cost of doing business to lower inflation, enhance competitiveness, and stimulate trade.

Under the first pillar, the programme will back the Investment and Securities Act 2025, introduce new credit enhancement facilities, and implement a CBN Rulebook to boost microfinance and non-bank financial institutions. It will also support the National Digital Economy and E-Governance Bill 2025, which aims to provide a legal foundation for e-transactions, digital authentication, and paperless government operations.

The second pillar targets lowering business and household costs, simplifying trade barriers, and promoting AfCFTA tariff concessions. The plan also includes improvements to certified seed systems for key crops such as rice, maize, and soybeans to enhance food security and attract agricultural investment.

Driving Inclusive Growth and Job Creation

The World Bank noted that while Nigeria has achieved macroeconomic stability through reforms; including fuel subsidy removal, exchange rate unification, and ending Central Bank deficit financing, growth remains fragile. Over 130 million Nigerians still live in poverty.

“Despite progress in stabilising the economy, Nigeria’s growth has yet to become broad-based or inclusive,” the report stated, highlighting the urgency of new investments to boost productivity and employment.

The $1bn policy operation forms part of a larger FY2026 World Bank package that includes complementary projects such as FINCLUDE (to expand MSME financing), BRIDGE (digital infrastructure), and AGROW (agricultural value chain development). Collectively, these projects aim to attract private capital, improve credit access, and foster a business-friendly environment.

Climate and Sustainability Components

 

The programme aligns with the Paris Climate Agreement, with components promoting climate-resilient agriculture, reduced deforestation, and digital governance systems to cut emissions from paper-based processes.

According to the Bank, the reforms supported under this facility are expected to:

• Reduce food inflation and production costs,

• Boost agricultural productivity and seed quality,

• Expand digital exports, and

• Create millions of direct and indirect jobs through MSME growth and rural inclusion.

Additionally, the removal of import bans and tariff reductions on key inputs are projected to make goods cheaper for consumers while strengthening Nigeria’s competitiveness in regional markets.

Debt Context

As of June 30, 2025, Nigeria’s external debt stood at $46.98 billion, according to the Debt Management Office (DMO). The World Bank remains Nigeria’s largest single creditor, holding $19.39 billion — comprising $18.04 billion from IDA and $1.35 billion from IBRD — representing 41.3% of the country’s total external debt.

Upon approval, the funds will be disbursed in two tranches tied to policy milestones, with implementation jointly overseen by the Federal Ministry of Finance, the Central Bank of Nigeria (CBN), and relevant government ministries.

The initiative is expected to anchor Nigeria’s shift from economic stabilisation to long-term, inclusive growth, making it one of the largest World Bank policy support programmes in recent years.