Nigeria is close to securing a loan of $1.5 billion and another $1-1.5 billion for the Federal Government and states respectively from the World Bank, Nigeria’s Minister of Finance, Zainab Ahmed has revealed.
She disclosed this on Tuesday at Citi Bank Investor update call with the Federal Government of Nigeria and organized by Citi Bank. Titled “Covid-19 Economic and Budgetary Update”.
According to Mrs. Zainab Ahmed negotiations with the World Bank “is on course” for a $1.5 billion facility for the Federal Government and another $1-1.5 billion for State Governments.
She also confirmed the amount Nigeria is looking to raise from the World Bank. “The amount we are raising in the first instance is $1.5 billion for FG and around September October we are hoping to close out on the facility meant for states and the amount is meant to be $1-1.5 billion.”
Recall that the federal government had indicated its plans to inject a bailout of N2.3 trillion into the economy which it hopes to source from three sources.
This is part of the government efforts to combat the effects of Covid-19 on the economy. Firstly, it claims it will raise N500 billion from Special Accounts. Special Accounts are government accounts approved by the National Assembly where monies are accrued from tax deductions, oil proceeds, or any other source as provided in the law like the Ecological Funds, Education Trust Fund, Universal Basic Education Fund, etc.
Secondly, it proposes to raise about N1.1 trillion from what it termed “CBN Structured Lending” which suggests more intervention loans from the CBN. It could also include restructuring existing intervention loans by offering moratorium and lower interest rates which were also captured in the report.
The balance of N334 billion and N302.9 billion respectively will come from “external bilateral/multilateral sources – N334billion and other funding sources – N302.9bn.” These are basically loans and grants from monetary development institutions and rich donor countries.