The World Bank has approved a $1.25 billion Development Policy Financing loan for Nigeria, disregarding widespread public criticism concerning the country’s escalating debt profile. This approval coincides with the unveiling of a new six-year Country Partnership Framework (CPF) for Nigeria, spanning 2026 to 2032, which aims to accelerate private sector-led growth and job creation.
The lender announced on Wednesday that its Board had endorsed the Nigeria Actions for Investment and Jobs Acceleration (NAIJA) Development Policy Financing operation. This forms a crucial part of the broader CPF, designed to support Nigeria's transition towards a more inclusive growth model.
The approval follows days of public backlash on social media, where Nigerians questioned the nation’s increasing reliance on external borrowing. Critics demanded greater accountability for previous World Bank loans and expressed concerns about the country's growing debt burden.
Loan Details and Reforms Supported
The $1.25 billion NAIJA DPF operation is designed to bolster reforms aimed at strengthening the foundations for economic growth and competitiveness. It seeks to stimulate private sector investment across various sectors.
Specifically, the facility will support initiatives to deepen Nigeria’s capital markets and modernize regulations for the digital economy and e-governance. It will also advance power sector reforms to accelerate electrification and reduce trade barriers in line with Nigeria’s commitments to ECOWAS and AfCFTA, which aims to ease price pressures.
Further reforms include improving access to quality agricultural seeds and strengthening domestic revenue mobilization. This financing is part of a broader World Bank Group support package, combining policy-based lending with investments in energy, digital infrastructure, agriculture, private sector development, and social protection.
New Six-Year Partnership Framework
Alongside the loan, the World Bank endorsed a new Country Partnership Framework for Nigeria, spanning 2026 to 2032. This framework outlines the strategy for supporting Africa’s largest economy over the next six years, with a primary focus on expanding private investment and creating employment opportunities.
The program aims to expand electricity access to 32 million Nigerians and provide broadband connectivity to 58 million people. It also seeks to improve health and nutrition services for 40 million citizens and support 9.5 million farmers through higher agricultural productivity and better access to quality inputs.
Mathew Verghis, the World Bank Country Director for Nigeria, stated that the new CPF provides the strategy for supporting Nigeria, with a strong focus on creating more and better jobs, particularly by enabling private sector-led growth. He acknowledged that recent macroeconomic gains have been critical to stabilizing the economy but emphasized that translating these into improved living standards requires addressing structural constraints to spur private sector investment and job creation.
Dahlia Khalifa, IFC Divisional Director for Nigeria, highlighted that Nigeria’s long-term growth potential will be shaped by its ability to attract investment, raise productivity, and unleash private sector job creation. Ed Mountfield, MIGA Vice President and Chief Financial Officer, added that while Nigeria’s reform progress creates opportunities, MIGA’s role is to manage risks through guarantees and political risk insurance to encourage investor confidence.
Nigeria's Growing Debt Profile
The latest approval marks the second-largest single World Bank facility secured by Nigeria under President Bola Tinubu, following the $1.5 billion Reforms for Economic Stabilisation to Enable Transformation Development Policy Financing approved in June 2024.
According to figures from the Debt Management Office (DMO), Nigeria’s debt to the World Bank surged from $17.81 billion at the end of 2024 to $19.89 billion as of December 31, 2025. This represents an increase of $2.08 billion, or 11.7 percent, within the period.
The DMO data further revealed that loans from the International Development Association (IDA) increased from $16.56 billion to $18.51 billion, while debt owed to the International Bank for Reconstruction and Development (IBRD) rose from $1.24 billion to $1.38 billion. As of the end of 2025, the World Bank accounted for 38.36 percent of Nigeria’s total external debt stock, which stood at $51.86 billion.
