The World Bank has approved a fresh $1.25 billion loan for Nigeria under its Nigeria Actions for Investment and Jobs Acceleration (NAIJA) program, despite growing public concern over the country’s rising debt profile and repeated calls for the Federal Government to reduce external borrowing.
The approval was announced on Wednesday alongside the unveiling of the World Bank’s new Country Partnership Framework (CPF) for Nigeria, which will guide the institution’s support for the country from 2026 to 2032.
According to the World Bank, the six-year strategy is designed to support Nigeria’s efforts to create jobs, strengthen the private sector and improve the lives of millions of citizens through investments in infrastructure, agriculture, healthcare, digital technology and energy.
In a statement announcing the approval, the World Bank said the new partnership framework aims to promote sustainable economic growth by encouraging private sector investment and creating more employment opportunities.
“The World Bank Group has endorsed a new Country Partnership Framework for Nigeria spanning 2026–2032, setting out a strategy to create more and better jobs at scale by unlocking private sector-led growth,” the statement said.
The bank also confirmed the approval of the Nigeria Actions for Investment and Jobs Acceleration Development Policy Financing (DPF) operation, valued at $1.25 billion, saying the facility would support the country’s ongoing economic reform program.
It explained that the loan is intended to help Nigeria build a more inclusive economy by strengthening the foundations for long-term growth and increasing opportunities for businesses and workers.
The approval comes only weeks after reports emerged that the Federal Government was seeking another World Bank facility, triggering criticism from many Nigerians who questioned the wisdom of taking on additional external debt at a time of economic hardship.
Many critics argued that although Nigeria has secured several foreign loans over the years, the benefits have not been reflected in improved living conditions, lower unemployment or better public services.
The country’s rising cost of living, high inflation, unemployment and persistent infrastructure challenges have fuelled public debate over the government’s borrowing strategy.
However, the World Bank maintained that Nigeria’s recent economic reforms have started to produce positive results.
According to the institution, reforms introduced by the Federal Government have contributed to stronger economic growth, increased government revenue, improved foreign exchange reserves and greater investor confidence.
The bank said its new partnership framework seeks to build on those gains by supporting projects that directly affect the lives of ordinary Nigerians.
Among its key targets, the framework aims to provide electricity access to 32 million Nigerians, expand broadband connectivity to 58 million people, improve health and nutrition services for 40 million citizens, and support about 9.5 million farmers through improved agricultural productivity.
It also plans to strengthen human capital development, expand digital infrastructure and improve access to reliable energy across the country.
The World Bank’s Country Director for Nigeria, Mathew Verghis, said the institution’s focus would be to help Nigeria translate recent economic improvements into tangible benefits for its citizens.
“Our new Country Partnership Framework provides the strategy for how the World Bank Group will support Nigeria over the coming years, with a strong focus on helping to create more and better jobs, particularly by enabling private sector-led growth,” Verghis said.
He added that although recent reforms had helped stabilise the economy, more work was needed to address long-standing structural problems that limit investment and job creation.
“The recent macroeconomic gains have been critical to help stabilise the economy. Translating improved macroeconomic conditions into better living standards will require addressing the structural constraints to spur private sector investment and job creation,” he said.
According to the World Bank, the $1.25 billion financing package will support reforms in several strategic sectors of the economy.
These include deepening Nigeria’s capital markets, modernising regulations governing the digital economy and electronic governance, advancing power sector reforms to improve electricity supply, lowering trade barriers in line with Nigeria’s commitments under the Economic Community of West African States (ECOWAS) and the African Continental Free Trade Area (AfCFTA), improving access to quality agricultural seeds and strengthening domestic revenue generation.
The bank said these reforms are expected to make the Nigerian economy more competitive while encouraging greater local and foreign investment.
“The NAIJA DPF operation, which amounts to $1.25 billion, supports a set of Government reforms to strengthen the foundations for growth and competitiveness,” the statement said.
It added that reducing trade barriers could also help lower the cost of goods and ease inflationary pressures by improving the movement of products within the region.
The International Finance Corporation (IFC), the private sector arm of the World Bank Group, also expressed confidence in Nigeria’s reform program.
The IFC’s Divisional Director for Nigeria, Dahlia Khalifa, said the country’s long-term economic success would depend largely on its ability to attract private investment and create jobs for its growing population.
“Nigeria’s long-term growth potential will be shaped by the economy’s ability to attract investment, raise productivity, and unleash private sector job creation, building on the capital of a rapidly growing population,” she said.
Similarly, the Vice-President and Chief Financial Officer of the Multilateral Investment Guarantee Agency (MIGA), Ed Mountfield, acknowledged that although reforms have improved the investment climate, risks remain.
He said MIGA would continue providing guarantees and political risk insurance to encourage investors to commit funds to Nigeria.
“Nigeria’s reform progress is creating important opportunities for private investment, but risks remain for investors. MIGA’s role is to help manage these risks—through guarantees and political risk insurance—so that investors can step in with confidence,” he said.
The latest approval is the second-largest single World Bank facility secured by the administration of President Bola Tinubu. It follows the $1.5 billion Reforms for Economic Stabilisation to Enable Transformation Development Policy Financing approved in June 2024 to support the government’s economic reform agenda.
Figures released by the Debt Management Office (DMO) show that Nigeria’s debt to the World Bank has continued to rise.
According to the DMO, the country’s debt to the World Bank increased from $17.81 billion at the end of 2024 to $19.89 billion as of December 31, 2025, representing an increase of $2.08 billion, or 11.7 per cent.
The data also showed that loans from the International Development Association (IDA), the World Bank’s concessional lending arm, rose from $16.56 billion to $18.51 billion during the period.
Debt owed to the International Bank for Reconstruction and Development (IBRD) also increased from $1.24 billion to $1.38 billion.
Overall, the World Bank accounted for 38.36 per cent of Nigeria’s total external debt stock of $51.86 billion at the end of 2025, making it the country’s largest external creditor.