World Bank Approves $2.25 Billion to Boost Nigeria’s Economy and Support Vulnerable Citizens


President Bola Ahmed Tinubu’s economic stabilization efforts received a significant boost with the World Bank’s approval of a $2.25 billion support package. This funding aims to bolster Nigeria’s economic reforms and provide crucial support to its most vulnerable populations.

The announcement was made by Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun, who detailed the two major financial support programs: the $1.5 billion Nigeria Reforms for Economic Stabilisation to Enable Transformation (RESET) Development Policy Financing Programme (DPF) and the $750 million Nigeria Accelerating Resource Mobilisation Reforms (ARMOR) Programme-for-Results (P-for-R).

“This combined total of $2.25 billion will offer essential financial and technical support as the government continues to address economic distortions,” Edun stated. “These reforms will create quality jobs and economic opportunities for all Nigerians. We welcome the support of the RESET and ARMOR programmes as we further consolidate and implement our policy reforms, consistent with accelerating investment and using public resources more sustainably to achieve our development goals.”

Upon assuming office last year, the Tinubu Administration faced substantial economic challenges, necessitating urgent reforms to reboot the economy and enhance Nigeria’s financial outlook. Initial measures included unifying multiple exchange rates and halting opaque subsidy payments on petrol. Additionally, the Central Bank of Nigeria (CBN) refocused on its core mandate of price stability, increasing interest rates to curb inflation.

A targeted cash transfer program is also being rolled out to mitigate the impact of high inflation on poor and economically insecure households.

Ousmane Diagana, the World Bank Vice President for Western and Central Africa, praised Nigeria’s comprehensive macro-fiscal reforms, stating: “Nigeria’s comprehensive macro-fiscal reforms are placing the country on a new path that can stabilize the economy and lift people out of poverty. It is essential to maintain the momentum of these reforms and continue to provide support to the poor and vulnerable to mitigate the impact of the cost-of-living crisis.”

The RESET DPF aims to strengthen Nigeria’s economic policy framework, create fiscal space, and protect the poor and vulnerable, while the ARMOR P-for-R focuses on supporting tax and excise reforms, improving tax revenue and customs administration, and safeguarding oil revenues.

These programs are backed by the International Development Association (IDA), the World Bank’s fund for the poorest countries, offering highly concessional funding with a 40-year term and an interest rate of just over one percent. IDA resources are intended to boost economic growth, reduce poverty, and improve lives in the world’s 76 poorest countries, including 39 in Africa.

The approval of these financial packages marks a significant milestone in Nigeria’s efforts to stabilize its economy and create a sustainable path for growth and poverty reduction. Minister Edun expressed optimism that the various reforms will soon return the economy to sustainable growth and reduce inflation significantly.

He noted the positive impacts of these reforms, such as the gradual return of domestic and foreign investors’ confidence, the repayment of N7.3 trillion overdraft from the CBN, and increased foreign capital inflows to boost FX liquidity.

In conclusion, Minister Edun highlighted President Tinubu’s achievements in achieving relative economic stability and growth within his first year, despite the challenges of high inflation. He emphasized the need for continued intervention measures, especially in agriculture, to fully realize the benefits of the reforms.

Mike Ojo

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