Two months after $2.2 billion World Bank loan, IMF to approve $3.4 billion loan for Nigeria to tackle COVID-19

Two months after the World Bank approved nearly $2.2 billion loan for Nigeria, the staff of the International Monetary Fund (IMF) will recommend the approval of $3.4 billion in emergency funding to Nigeria on Tuesday.

The new IMF loan, “scheduled to be repaid in a maximum of five years, would be the largest allocation yet by the IMF to an African country to assist with the coronavirus pandemic,” Bloomberg reported, quoting two people with direct knowledge of the plan.


Nigeria’s request for $3.4 billion under the Rapid Financing Instrument (RFI) will be considered on April 28, an IMF spokesperson said.

The RFI or Rapid Financing Instrument is said to offer funding without the strings of a full program. But it remains a loan to be repaid, a cheaper loan.

The IMF loan would be repaid in a maximum of five years. President Muhammadu Buhari would be leaving office in three years on May 29, 2023.

President Muhammadu Buhari (2nd), Chats with Amechi Asugwuni, Comrade NLC President Comrade Ayuba Wabba, Comrade Ibrahim Khaleel, Comrade Najeem Usman Yasin, Comrade Musa Lawal and others during a congratulatory visit by Labour Leadership for the 2nd term re-election of the President held at the Council Chambers, State House Abuja Thursday. PHOTO; SUNDAY AGHAEZE. MARCH 7TH 2019.

Nigeria also requested another $3.5 billion in total from the World Bank and the African Development Bank.

In all, the government is seeking $3.4 billion from the International Monetary Fund, $2.5 billion from the World Bank and $1 billion from the African Development Bank, Finance Minister Zainab Ahmed told reporters two weeks ago in the capital, Abuja.

Zainab Ahmed, Nigerian Minister of Finance

Just over two weeks ago on April 13, the IMF approved the disbursement of $1 billion to Ghana to respond to coronavirus economic turbulence. The $1 billion would be drawn under the Rapid Credit Facility.

In a statement, IMF said the disbursement of $1 billion to Ghana where the president is seeking re-election in December, will help address the urgent fiscal and balance of payments needs that Ghana is facing, improve confidence, and catalyze support from other development partners.

Former President John Mahama would challenge incumbent Nana Akufo-Addo in this year’s election.

For Nigeria, the Managing Director of the IMF Ms. Kristalina Georgieva had announced on April 7 that the government “has requested financial assistance under the Fund’s Rapid Financing Instrument (RFI).”

Ms. Georgieva said the “emergency financing would allow the government to address additional and urgent balance of payments needs and support policies that would make it possible to direct funds for priority health expenditures and protect the most vulnerable people and firms”.

She said Nigeria’s economy was being threatened by the twin shocks of the COVID-19 pandemic and the associated sharp fall in international oil prices.

“We are working hard to respond to this request so that a proposal can be considered by the IMF’s Executive Board as soon as possible,” the IMF boss added.


Last week, Ms. Georgieva said the IMF will mobilize more than $18 billion to respond to more than 40 African countries who have requested assistance to battle the pandemic.


When Nigeria secured $2.2 billion loan from the World Bank in mid-February, the bank said the money would be invested in six projects, including “improving immunization”, “enabling a stronger business environment for the private sector”, “expanding the digital economy to promote job creation”, and “increasing public and private sector capacity on governance and social and environmental safeguards”.

The World Bank money for the six projects will come from the International Development Association (IDA), the French Development Agency, the European Investment Bank and the federal government of Nigeria.

“Nigeria is central to the World Bank Group’s mission of tackling extreme poverty. The World Bank is carefully targeting its support on high impact projects as the country works to tackle corruption and lift 100 million of its people out of poverty,” said David Malpass, World Bank Group President.

According to Shubham Chaudhuri, World Bank Country Director for Nigeria “the projects focus squarely on delivering better services for Nigerians: ensuring that children are immunized and sleep under mosquito nets, building better roads especially in rural areas, and providing Nigeria’s poorest citizens with a unique identification that will make social safety nets and services more effective”.

Nigerian Vice President Yemi Osinbajo chairs first virtual COVID-19 meeting with 7 governors and finance minister 
Nigerian Vice President Yemi Osinbajo chairs first virtual COVID-19 meeting with 7 governors and finance minister

Although the World Bank chiefs tried to focus on the projects rather than the debt and repayment conditions as well as the time it would take to pay back the billions of dollars being borrowed by the Buhari administration, the February loan pushed Nigeria’s domestic and foreign debt to over $80 billion, and came barely a year after the global bank disbursed about $2.4 billion to Nigeria.


Nigeria’s reported domestic debt was already put at $55.6 billion and foreign loans at $25.6 billion or a total of over $80 billion.

President Muhammadu Buhari and his finance minister Zainab Ahmed have skyrocketed borrowing to finance government spending.

The Buhari administration believes to ease the debt burden, Nigeria has to borrow more with low interest and long repayment periods from many institutions including the World Bank and the African Development Bank.

President Buhari at the 29th Forum of Heads of State and Government of Participating States of the African Peer Review Mechanism (APRM) at the AU Summit in Addis Ababa on 8th Feb 2020 
President Buhari at the 29th Forum of Heads of State and Government of Participating States of the African Peer Review Mechanism (APRM) at the AU Summit in Addis Ababa on 8th Feb 2020


According to the World Bank, the approved program for the fiscal year 2020 comprises the following projects:

  • Immunization Plus & Malaria Progress by Accelerating Coverage and Transforming Services will strengthen health systems to deliver effective primary health care and improve immunization, malaria control, and child and maternal health in selected states. Among key results, the project aims to broaden vaccination coverage, increase the percentage of children under five who sleep under insecticide-treated nets from 28 to 41%, and improve the percentage of women who receive post-natal check-ups from 47 to 55%. The project is financed under concessional terms through an International Development Association (IDA) credit of $650 million.
  • Nigeria Rural Access and Agricultural Marketing Project will upgrade rural roads and improve connectivity and access to local markets and agrobusiness services in 13 states. Specifically, the project will upgrade about 1,600 kilometers of rural roads and improve 65 agro-logistics centers. These interventions are expected to boost the proportion of population who live within two kilometers of an all-season road by up to 10%. The project is co-financed through an IDA credit of $280 million$230 million from the French Development Agency, and $65m from the Government of Nigeria.
  • Nigeria Digital Identification for Development Project will support the National Identity Management Commission to increase the number of persons who have a national identification number (NIN) reaching about 150 million in the next three years. This will enable people in Nigeria, especially marginalized groups, to access welfare-enhancing services. The project will also enhance the ID system’s legal and technical safeguards to protect personal data and privacy. This is co-financed through an IDA credit of $115 million$100 million from the French Development Agency, and $215 million from the European Investment Bank.
  • Ogun State Economic Transformation Project will catalyze private investment in Ogun State by improving the business environment, strengthening the linkages between agricultural producers, suppliers and service providers, and providing training and apprenticeships for women and farmers. Among some of the key results, the project will facilitate collaboration between farmers and agribusinesses improve STEM teaching in up to 70% of public secondary schools. This is financed through an IDA credit of $250 million. 
  • Innovation Development and Effectiveness in the Acquisition of Skills Project will strengthen the skills of 50,000 Nigerian students and enhance the capacity of technical teachers to better equip them for jobs in the formal and informal sectors. The project aims to increase the female enrollment rate from 13% to 23% in technical colleges and provide recognized skills and certification to 3,000 youth after they complete an informal apprenticeship. This is financed through an IDA credit of $200 million.
  • Sustainable Procurement, Environmental and Social Standards Enhancement Project will strengthen capacity in managing procurement, environmental and social standards in the public and private sectors. The project will enhance the skills of over 21,000 people and help 4,000 professionals become certified in procurement, environment and social standards. It will also ensure that accredited degree programs meet International best practice and Good International Industry Practice in these areas. The project will help tackle corruption and the risk of environmental or social harm as investments are implemented. This is financed through an IDA credit of $80 million
Chief White House Correspondent for

Simon Ateba is Chief White House Correspondent for Today News Africa. Simon covers President Joe Biden, Vice President Kamala Harris, the U.S. government, the United Nations, the International Monetary Fund, the World Bank and other financial and international institutions in Washington D.C. and New York City.

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