The World Bank's Financial Statement has revealed the position of Nigeria among the loan collectors of the institution. It's quit unfortunate that Nigeria has ascended to the 3rd position with $2.2 billion increase on the list of largest debtors to the World Bank’s International Development Association (IDA) as of June 30, 2024. Meanwhile, it's important to note that IDA loan is different from any outstanding loan from the World Bank’s International Bank for Reconstruction and Development (IBRD).
The $2.2 billion loan increase secured under Tinubu's government has placed Nigeria among the top three IDA debtors for the first time. As per the bank's financial statement, Nigeria loan application to the IDA increased significantly by 14.4% from $14.3 billion in the fiscal year (FY) of 2023 to $16.5 billion in FY2024, marking a surge from its previous position as the fourth-largest borrower in 2023 to third-largest debtor as of June 2024.
Other notable debtors are Bangladesh, which maintains the largest debtor on the list, Pakistan, India, India, Ethiopia, Kenya, Vietnam, Tanzania, Ghana and Uganda as the 10th-largest borrower of the World Bank's IDA. India, which was the third-largest borrower in 2023 with $17.9 billion, reduced its IDA exposure to $15.9 billion in 2024, enabling Nigeria to overtake it.
The International Development Association (IDA) is a part of the World Bank's international services that's aimed at offering low-interest loans, credits and grants to help and support the world's poorest countries. These loans and credits are aimed at supporting and enhancing economic growth, reducing inequalities, and improving citizen standard of in developing countries.
Notably, under the President Tinubu Administration, Nigeria had secured a sum of $4.95 billion in loans from the World Bank despite the concerns about the country's rising external debt. Meanwhile, it's important to know that Nigeria has only received about 16% of these new loans so far, with a substantial $4.16 billion still awaiting disbursement.
The low disbursement rate of just 16% has raised concerns about the effectiveness of the current administration in securing and using international funds for national development. This delay could also delay the economic growth and development that these loans are meant to support. Despite the awaiting disbursement, the World Bank continues to approve loan to Nigeria. According to report, the institution may approve four additional loan projects worth $2 billion for Nigeria this year.
Lastly, it also worth noting that Nigeria owes the World Bank a total of $15.59 billion as of March 31, 2024. This record was revealed by data from the Debt Management Office (DMO).
