The World Bank has approved a $2.25 billion financial package for Nigeria aimed at sustaining economic reforms, boosting non-oil revenue mobilization, and supporting the country’s most vulnerable populations.
This funding is divided into two separate financing interventions: $1.5 billion for the Reforms for Economic Stabilization to Enable Transformation (RESET) Development Policy Financing Programme (DPF), and $750 million for the Accelerating Resource Mobilization Reforms (ARMOR) Programme-for-Results (PforR).
The World Bank stated that this combined package will provide immediate financial and technical support to Nigeria’s efforts to stabilize the economy and enhance support for the poor and economically at-risk groups. The intervention is part of a multi-year effort to increase non-oil revenues and protect oil revenues, promoting fiscal sustainability and ensuring the delivery of quality public services.
Faced with a fragile economic situation, Nigeria has recognized the need for urgent reforms to address economic distortions and improve the fiscal outlook. The government has taken critical steps to restore macroeconomic stability, boost revenues, and create conditions for growth and poverty reduction. Key reforms include unifying multiple official exchange rates to foster a market-determined rate and adjusting gasoline prices to phase out the costly petrol subsidy. Additionally, the Central Bank of Nigeria (CBN) has refocused on its mandate of price stability by tightening monetary policy and increasing interest rates to reduce inflation.
The World Bank also acknowledged the implementation of a targeted cash transfer program to cushion the impact of high inflation on poor and economically insecure households.
Welcoming the latest financing approvals, Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun, emphasized that the government is committed to bold and necessary reforms to restore macroeconomic stability and drive sustainable and inclusive economic growth.
“We welcome the support of the RESET and ARMOR programs as we consolidate and implement our macro-fiscal and social protection policy reforms. This will help accelerate investment and redirect public resources sustainably to achieve our development priorities,” said Edun.
World Bank Vice President for Western and Central Africa, Ousmane Diagana, commended Nigeria’s efforts to implement far-reaching macro-fiscal reforms, which have positioned the country on a path to economic stability and poverty alleviation. Diagana stressed the importance of sustaining reform momentum and expanding protection for the poor to mitigate cost-of-living pressures.
“This financing package reinforces the World Bank’s strong partnership with Nigeria and our commitment to reinvigorating its economy and fast-tracking poverty reduction, serving as a beacon for Africa,” Diagana stated.
The Director of Information and Public Relations at the Federal Ministry of Finance, Mohammed Manga, highlighted that the RESET DPF aims to strengthen Nigeria’s economic policy framework, create fiscal space, and protect the poor and vulnerable. The ARMOR PforR supports tax and excise reforms, improves tax revenue and customs administration, and safeguards oil revenues.
The International Development Association (IDA), established in 1960, is the World Bank’s fund for the poorest countries, providing grants and low to zero-interest loans for projects and programs that boost economic growth, reduce poverty, and improve lives. IDA remains one of the largest sources of assistance for the world’s 76 poorest countries, 39 of which are in Africa, helping to positively impact the lives of 1.6 billion people.
Since its inception, IDA has supported development work in 113 countries, with annual commitments averaging $21 billion over the past three years, with about 61 percent going to Africa.
