As of June 30, 2024, Nigeria has risen to become the third largest debtor to the World Bank’s International Development Association (IDA), reflecting a notable increase in the country’s borrowing from the institution,leadership reports.
This development marks a significant shift in Nigeria’s financial landscape under President Bola Tinubu’s administration.
The World Bank’s latest financial statements reveal that Nigeria’s exposure to the IDA has surged by 14.4%, climbing from $14.3 billion in fiscal year (FY) 2023 to $16.5 billion in FY2024.
This $2.2 billion increase has propelled Nigeria into the top three IDA debtors for the first time, moving up from its previous position as the fourth-largest borrower in 2023.
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The fiscal year 2024, which spans from July 2023 to June 2024, saw Nigeria receiving at least $2.2 billion from the World Bank, highlighting the country’s growing reliance on international financial support amid domestic economic challenges.
It’s important to note that this debt is specific to the IDA and does not include any outstanding loans Nigeria has with the World Bank’s International Bank for Reconstruction and Development (IBRD).
Among other top IDA debtors, Bangladesh continues to be the largest borrower, with its exposure rising from $19.3 billion in 2023 to $20.5 billion in 2024.
Pakistan follows as the second-largest borrower, maintaining a stable exposure of $17.9 billion over the same period. Meanwhile, India, which was the third-largest borrower in 2023 with $17.9 billion, saw its IDA exposure decrease to $15.9 billion in 2024, allowing Nigeria to surpass it.
Other significant IDA borrowers include Ethiopia, whose exposure increased from $11.6 billion in 2023 to $12.2 billion in 2024.
Kenya and Vietnam each have exposures of $12.0 billion. Along with Tanzania, Ghana, and Uganda, these countries round out the top ten IDA debtors, collectively accounting for 63% of the IDA’s total exposure as of June 30, 2024.
The IDA, a critical arm of the World Bank, provides concessional loans and grants to the world’s poorest countries, offering low interest rates and extended repayment periods to support economic growth, reduce inequalities, and improve living conditions in developing regions.
Reports indicate that under Tinubu’s administration, Nigeria secured a total of $4.95 billion in loans from the World Bank, amid growing concerns over the country’s rising external debt servicing costs.
However, only about 16% of these new loans have been disbursed so far. The World Bank may approve an additional four loan projects for Nigeria this year, potentially totaling $2 billion.
Furthermore, data from the Debt Management Office (DMO) reveals that Nigeria’s total debt to the World Bank stood at $15.59 billion as of March 31, 2024.
