Nigeria seeks $1.25bn World Bank loan for reforms and jobs as public debt rises ahead of 2027 elections
The Federal Government of Nigeria has intensified negotiations for a fresh $1.25bn facility from the World Bank, as the proposed loan advances to a critical approval stage amid growing concerns over the country’s rising debt profile.
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The facility, tagged “Nigeria Actions for Investment and Jobs Acceleration,” is expected to be considered for approval on June 26, 2026, according to documents linked to the World Bank’s project cycle and Nigeria’s electoral timetable ahead of the 2027 general elections.
If approved, the loan will be among the largest secured under President Bola Tinubu, following the $1.5bn development policy financing approved in 2024, further deepening Nigeria’s engagement with multilateral lenders.
At an exchange rate of N1,361.4 to the dollar, the proposed facility translates to about N1.70tn, highlighting the scale of external borrowing being pursued alongside ongoing economic reforms.
The Independent National Electoral Commission, Independent National Electoral Commission has indicated that the 2027 general elections will take place in January and February 2027, a timeline that places the loan approval period close to a politically sensitive moment for the country.
According to World Bank documentation, the project has now reached the decision meeting stage, where final appraisal is reviewed before submission to the Board of Executive Directors for approval.
The Federal Ministry of Finance will serve as the implementing agency for the programme, which is designed to expand access to finance, digital services, electricity, and strengthen competitiveness through tax, trade and agricultural reforms.
The World Bank stated that the initiative aligns with its Country Partnership Framework for Nigeria and supports broader development programmes aimed at restoring economic stability and promoting inclusive growth.
However, the bank also warned that political and governance risks remain high ahead of the 2027 elections, which could affect reform implementation.
The proposed loan comes as Nigeria’s external debt continues to rise. Data shows that total public debt could climb to about N160.98tn if the facility is fully approved and disbursed, further intensifying debates over fiscal sustainability.
Economists have expressed mixed reactions, with some describing the loans as concessionary and useful if tied to productive investments, while others warn of long-term risks if borrowing continues to outpace revenue growth.
Development experts argue that while external financing can support infrastructure and reforms, Nigeria must strengthen domestic revenue mobilisation to avoid long-term debt distress.
The Nigerian Economic Summit Group also cautioned that despite apparent improvements in headline indicators, Nigeria remains in a high-risk fiscal environment driven by structural weaknesses and persistent borrowing.
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As discussions continue, analysts say the outcome of the proposed World Bank loan will further shape Nigeria’s economic trajectory ahead of the 2027 elections, especially as debt servicing obligations continue to rise.
