Nigerian Government is in discussions with the World Bank for three new financing facilities worth a combined $1.5 billion, even as Nigeria’s public debt climbed to a record N166.79 trillion at the end of June 2026.
The proposed facilities, each valued at $500 million, are designed to support climate resilience, social protection and early childhood development, according to World Bank project documents.
The first is an additional $500 million financing for the Agro-Climatic Resilience in Semi-Arid Landscapes project, known as ACReSAL. The World Bank has scheduled October 29, 2026, for consideration of the facility by its board.
The Federal Republic of Nigeria is listed as the borrower, while the Federal Ministry of Environment will implement the project.
If approved, the additional financing will raise ACReSAL’s total funding from $700 million to $1.2 billion, with the new facility expected to come entirely from the International Development Association, the World Bank’s concessional financing arm.
The additional funding will support landscape restoration, watershed rehabilitation, erosion and flood management, irrigation and drainage, water harvesting and storage, reforestation and other climate-resilient interventions.
Of the proposed $500 million, $310 million is earmarked for dryland management, $165 million for community climate resilience and $25 million for institutional strengthening and project management.
ACReSAL currently operates in 19 northern states and the Federal Capital Territory, focusing on land degradation, water insecurity, climate vulnerability and declining agricultural productivity.
The World Bank estimates that desertification and land degradation affect about 43 per cent of Nigeria’s land area. It also projects that the effects of climate change could reduce Nigeria’s GDP by about 2.6 per cent annually by 2030 and as much as 6.7 per cent by 2050 if not adequately addressed.
The second proposed facility is a $500 million IDA credit for the Household Prosperity and Empowerment-Social Protection Project, known as HOPE-SP.
The project is still at an earlier preparation stage, with its technical design review scheduled for October 30, 2026. The World Bank has tentatively scheduled March 16, 2027, for consideration of the project.
The Federal Ministry of Finance is listed as the borrower, while the Federal Ministry of Humanitarian Affairs and Poverty Reduction is expected to implement the programme.
The facility comprises a $420 million results-based programme and an $80 million investment project financing component.
The programme is designed to expand regular social assistance for poor and vulnerable households while gradually increasing financing from federal and state budgets.
It would support targeted unconditional and conditional cash transfers, modernise the social registry, integrate the National Identification Number into the social protection information system and strengthen implementation at federal, state and local government levels.
The World Bank said Nigeria spent only 0.14 per cent of GDP on social safety-net programmes in 2021, compared with a global average of 1.5 per cent and 1.2 per cent among lower-middle-income countries.
The bank also estimated that the proportion of Nigerians living in poverty rose from 40 per cent in 2019 to 56 per cent in 2023 and could reach 62.5 per cent in 2026. It attributed the deterioration to factors including the COVID-19 pandemic, inflation, natural disasters and conflict, while noting that subsidy removal and exchange-rate reforms increased living costs in the short term.
The third proposed facility is another $500 million for the Nigeria Early Childhood Development programme.
The World Bank has scheduled October 30, 2026, for its technical design review and March 15, 2027, as the tentative approval date.
The Federal Ministry of Finance would serve as the borrower, while the Federal Ministry of Budget and Economic Planning is expected to implement the programme.
The project would cover all 36 states and the FCT and focus on improving access to health, nutrition, early learning, childcare, water and sanitation services for children from birth to five years.
The proposed financing comprises $400 million under a programme-for-results component and $100 million in investment project financing.
The World Bank said the intervention was necessary because 40 per cent of Nigerian children under five are stunted, fewer than half are developmentally on track and only 36 per cent of children aged 36 to 59 months attend organised early learning.
The proposed borrowing comes against the backdrop of a rising public debt stock.
Fresh figures from the Debt Management Office show that Nigeria’s total public debt rose by N14.39 trillion, from N152.40 trillion in June 2025 to N166.79 trillion at the end of June 2026.
The increase represents 9.44 per cent year-on-year. In dollar terms, however, public debt rose by $21.27 billion, or 21.35 per cent, from $99.66 billion to $120.93 billion.
The difference reflects, among other factors, the exchange rate used in valuing the external debt. The DMO applied an official rate of N1,379.1842 to the dollar in June 2026, compared with N1,529.2105 a year earlier.
On a quarterly basis, the debt stock increased by N7.44 trillion, or 4.67 per cent, from N159.35 trillion in March 2026 to N166.79 trillion in June.
Domestic debt stood at N91.59 trillion, representing 54.91 per cent of the total, while external debt amounted to N75.20 trillion, or 45.09 per cent.
Nigeria’s outstanding obligations to the World Bank Group also rose to $20.73 billion at the end of June 2026, comprising $19.12 billion owed to IDA and $1.61 billion to the International Bank for Reconstruction and Development.
The World Bank exposure increased by $1.34 billion, or 6.93 per cent, from $19.39 billion in June 2025. At $20.73 billion, the World Bank Group accounted for about 38 per cent of Nigeria’s $54.52 billion external debt stock. ([Punch Newspapers][1])
The proposed facilities would add to a World Bank portfolio that has expanded substantially under the Tinubu administration. The bank approved a $1.25 billion financing package for Nigeria in July 2026 to support investment, jobs and economic reforms.
The latest proposals therefore come amid renewed debate over Nigeria’s borrowing needs, debt sustainability and the effectiveness of deploying concessionary financing for development projects.
Economists have noted that the terms and utilisation of multilateral loans are important considerations, particularly where the funds are tied to projects intended to strengthen social services, climate resilience and economic productivity.
