The federal government has signed a $500 million development policy financing agreement with the World Bank, with disbursement conditioned on Nigeria meeting specific economic reform and fiscal accountability benchmarks.
The facility, arranged under the Nigeria Actions for Investment and Jobs Acceleration (NAIJA) programme, was signed on behalf of Nigeria by the Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, on October 6, 2026. The International Bank for Reconstruction and Development (IBRD) will disburse the loan in two withdrawal tranches of $249.375 million each, while $1.25 million is allocated to the front-end fee.
Access to the funds is linked to satisfactory progress on reforms aimed at strengthening the business environment, improving public revenue collection and lowering trade barriers. The agreement forms part of a wider $1.25 billion development policy financing package approved by the World Bank board in June 2026.
The first tranche can only be withdrawn once the bank is satisfied with implementation of the programme and the adequacy of Nigeria's macroeconomic policy framework. Release of the second tranche carries additional requirements: the bank must be satisfied with progress in carrying out the programme, the macroeconomic framework must remain adequate, and specified policy actions must have been completed.
The lender reserved the right to cancel all or part of any undisbursed balance if the government fails to implement corrective measures within 90 days of receiving a notice of non-compliance.
Nigeria is also required to hold the proceeds in a dedicated foreign currency account and to record an equivalent amount in its budget management system. Within 30 days of each withdrawal, the Federal Ministry of Finance must report the amount received, the naira account credited, evidence of entry into the budget management system and a statement of receipts and disbursements. Auditors of the Central Bank of Nigeria acceptable to the World Bank must audit the dedicated account within one month of withdrawal, with a certified report submitted within four months and published. The facility closes on December 31, 2027.
The signing comes amid public concern over the country's debt burden. The World Bank recently reported that interest payments rose to N7.7 trillion in the first half of 2026 from N5.6 trillion a year earlier, equivalent to 124.19 percent of federal government revenue and 3.1 percent of GDP, up from 2.5 percent.
