The Federal Government of Nigeria is seeking $1.5bn in fresh financing from the World Bank to support key development initiatives. The proposed financing comprises three separate $500m International Development Association credits, targeting household welfare, human capital development, and climate resilience. This move comes as Nigeria's total public debt has climbed to N166.79tn, with a significant increase of N79.41tn within three years.
Nigeria's public debt stock has risen by $21.27bn, from $111.34bn to $132.61bn, within the same period. The World Bank Group's exposure to Nigeria increased by $1.34bn, or 6.93 per cent, from $19.39bn in June 2025 to $20.73bn at the end of June 2026. This accounts for about 38 per cent of Nigeria's $54.52bn external debt. The proposed borrowing will add to Nigeria's existing obligations to the World Bank Group.
One of the proposed facilities is a $500m additional financing for the Agro-Climatic Resilience in Semi-Arid Landscapes project, aimed at scaling up climate-resilient interventions. The project, implemented by the Federal Ministry of Environment, targets land degradation, water insecurity, and climate vulnerability in 19 northern states and the FCT. The World Bank estimates that desertification and land degradation affect 43 per cent of Nigeria's land area.
The World Bank has estimated that climate inaction could reduce Nigeria's GDP by 2.6 per cent annually by 2030 and as much as 6.7 per cent by 2050. The additional financing will allocate $310m to dryland management, $165m to community climate resilience, and $25m to institutional strengthening and project management. The proposed interventions include watershed rehabilitation, erosion and flood management, and reforestation.
Another $500m facility is proposed for the Household Prosperity and Empowerment-Social Protection Project, designed to establish regular social assistance for poor and vulnerable households. The project will support targeted unconditional and conditional cash transfers, nutrition, and access to education and health services. The World Bank notes that Nigeria spent only 0.14 per cent of its GDP on social safety-net programmes in 2021.
The proportion of Nigerians living below the national poverty line increased from 40 per cent in 2019 to 56 per cent in 2023 and is expected to reach 62.5 per cent in 2026. The World Bank attributes the deterioration largely to the pandemic, inflation, disasters, and conflict. The lender also notes that Nigeria has no permanent social safety-net programme.
The third $500m facility is proposed for the Nigeria Early Childhood Development programme, aiming to increase access to integrated quality services for children aged zero to five. The programme seeks to improve governance, financing, and accountability, and strengthen frontline delivery systems and workforce capacity. The World Bank notes that 40 per cent of children under five in Nigeria are stunted, and fewer than half are developmentally on track.
Key points
- Nigeria's public debt has climbed to N166.79tn, with a significant increase of N79.41tn within three years.
- The proposed $1.5bn World Bank loan comprises three separate $500m International Development Association credits.
- The World Bank estimates that climate inaction could reduce Nigeria's GDP by 2.6 per cent annually by 2030 and as much as 6.7 per cent by 2050.
